Cook­ing gas scarcity looms as PPPRA or­ders off-tak­ers to sub­mit tem­plates

Daily Trust - - BUSINESS - From Mo­hammed Shosanya, La­gos

The Petroleum Prod­ucts Pric­ing Reg­u­lat­ing Agency (PPPRA) has or­dered stake­hold­ers and off-tak­ers of Liq­ue­fied Petroleum Gas (LPG), also known as cook­ing gas, to sur­ren­der their pric­ing tem­plates to the agency, Daily Trust learnt.

But stake­hold­ers, con­demn­ing the PPPRA, in the in­dus­try are ac­cus­ing the PPPRA of sab­o­tag­ing LPG in­dus­try “through the back-door.”

They feared that the ac­tion of the agency may plunge the coun­try into a gas sup­ply hitch, which, they main­tained, was at vari­ance with the ef­forts of the fed­eral gov­ern­ment to pro­mote the con­sump­tion of cook­ing gas in Nige­ria.

Nige­ria still ranks low­est in sub-Sa­hara Africa in per capita us­age of LPG, con­sum­ing 1.1kg, com­pared with Ghana at 3.0kg; South Africa, 5.5kg and Morocco, 44kg per capita.

The PPPRA had al­ready writ­ten letters to some LPG off-tak­ers and plant own­ers de­mand­ing a com­pre­hen­sive dis­clo­sure of their pric­ing tem­plate to has­ten its plan.

Our cor­re­spon­dent gath­ered that the Ex­ec­u­tive Sec­re­tary of the PPPRA, Farouk Ahmed per­son­ally signed the let­ter re­quest­ing LPG off-tak­ers to share their pric­ing tem­plate with the agency.

The Nige­ria Liq­ue­fied Petroleum Gas As­so­ci­a­tion (NLPGA) ar­gued that the PPPRA was at lib­erty to de­velop a pric­ing tem­plate for the prod­uct with­out nec­es­sar­ily re­quest­ing and plac­ing an or­der for an in­put from LPG op­er­a­tors.

The as­so­ci­a­tion stated, “The NLPGA does not ar­gue with the au­thor­ity of the PPPRA, but, how­ever, wishes to ad­dress our pro­posed in­ter­ven­tion. The NLPGA can­not find any rel­e­vance of the PPPRA at the mo­ment, con­sid­er­ing that the LPG mar­ket is fully dereg­u­lated and sub­ject to forces of de­mand and sup­ply.

“Another thing is that if the PPPRA wants to de­velop its pric­ing tem­plate for LPG, it may as well go ahead to do that, with­out nec­es­sar­ily re­quest­ing in­put from LPG op­er­a­tors, who by them­selves, each de­vel­oped their re­spec­tive pric­ing tem­plates.”

The as­so­ci­a­tion chal­lenged the PPPRA to prove its rel­e­vance, “con­sid­er­ing that petrol and kerosene, both prod­ucts un­der the com­plete reg­u­la­tion of PPPRA do not de­liver to the com­mon man at the gov­ern­ment reg­u­lated (sub­si­dized) prices.”

Most of the LPG off-tak­ers com­pa­nies con­firmed re­ceipt of PPPRA’s letters to our cor­re­spon­dent yesterday.

One of the off-tak­ers told our cor­re­spon­dent that the ac­tion of the agency may breed price fix­ing for cook­ing gas, which, he main­tained, is a dereg­u­lated prod­uct. He said the PPPRA de­ci­sion “ham­pers ef­forts by gov­ern­ment and other stake­hold­ers to pro­mote us­age of LPG.

Ac­cord­ing to him, the agency’s de­mand for stake­hold­ers’ pric­ing tem­plate baf­fles many op­er­a­tors in the in­dus­try. ago de­clared that the PPPRA “has no busi­ness reg­u­lat­ing LPG.”

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