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Cooking gas price may rise by 15%

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Cooking gas price may rise by 15%

Consumers of cooking gas in Nigeria may have to brace up to accommodate a possible rise in price of the commodity, as dealers may have concluded plans to jerk up the price before the end of June 2017.

Investigations revealed that failure of the Nigerian National Petroleum Corporation (NNPC) to attend to requests by major gas dealers in the country is responsible for the price of commodity not coming down since it witnessed an increase in November 2016.

A 12kg gas cylinder, which was selling at N3.500 before November, rose to N4200 (13 per cent increase) in Lagos and Abuja, and N4500 (14 per cent) in other parts of the country.

But another tranche of price hike is being considered which may see the same volume of gas go for between N4,600 to N5,000, unless the impasse between NNPC and gas distribution companies over business deal is resolved before the end of June, according to dealers.

This was disclosed by the spokesman of Association of Liquefied Petroleum Gas Marketers (NALPGAM), Mr. Gilbert Johnson, who told Ripples Nigeria that the refusal of NNPC to create a credit facility that could see the dealers have a breather over the impact of recession on the sector is not helping the sector.

Read also: Nigeria spent N4.74tn on imported fuel in 2016

“Most of us have been bearing heavy costs, in attempts to deliver gas to the end users and at affordable prices too. This has seen us not talking about profit making in the past years.

“The cost of delivering the product to industrial users is not as demanding as it is to have domestic users receive it.

“We have requested that the government, through the NNPC, should find a way of bridging the costs, which can lead to having it sold uniformly in all parts of the country. But this is yet to be attended to.

“This will help boost government policy of reducing use of wood for cooking, but not much is being done to achieve this with price of gas being allowed to soar”, Johnson said.

He further disclosed that the recession had made it impossible for operators to meet their local and foreign debts obligations, caused by scarcity of dollars that saw most of the dealers failing to meet their debt servicing agreements.

According to him, there will be no option than to increase the price of cooking gas to as much as between 15 to 20 per cent.

It was learnt that the price of industrial gas has remained steady in the past six months, following an understanding between dealers and the manufacturing firms that an agreed increase in price should be allowed and to be revisited in 2018 .

When contacted, NNPC spokesman, Ndu Ughamadu, denied knowledge of any face-off between the corporation and the gas dealers.

He said, “The only issue that NALPGAM has been drawing our attention to is how to resolve the leadership crisis that visited the association recently. That of assisting them secure credit for their product, as to lead to reducing the price is what can only be viewed when all issues are put on the table.”

But some of the dealers insist that there may be another scarcity of the product, unless urgent attention is paid to the crisis that most of them are facing.

 

 

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