The cover price of Liquefied Petroleum Gas (LPG) also known as cooking gas, may soon spike across various parts of the country as the Nigeria Liquefied Natural Gas (NLNG) Limited declared force majeure on its 22.2 million tons per year Bonny LNG export facility.
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Experts have warned that the cost of filling a 12.5kg cylinder of cooking gas in Nigeria may hit N12,000 or more by November, up from N9,800 as of October.
A checks indicate that NLNG declared force majeure on its gas supply contracts due to the widespread flood that has disrupted the upstream activities of the gas supply.
The NLNG disclosed the development in a statement by its General Manager, External Relations and Sustainable Development, Mr Andy Odeh, saying a clause known as “force majeure” is frequently found in contracts and, in essence, releases both parties from responsibility or obligation when an extraordinary event or circumstance, such as a war, strike, riot, crime, epidemic, or sudden changes in the law, prevents one or both parties from upholding their end of the bargain.
Odeh said NLNG was determining the extent of the disruption and would try to mitigate the impact of the force majeure.
Energy experts who spoke during separate interviews with Nairametrics disclosed that, if the flooding persists till November amid other industry issues, it will cost Nigerians N12,000 or more to fill a 12.5kg gas cylinder. However, the price hike could be averted if the challenges are addressed.
Energy Consultant, Gboyega Amu said, “The cost of 12.5kg is expected to hit N12,000 or more by November, as NLNG’s declaration could worsen Nigeria’s cash crunch and would curtail global gas supply as Europe and others struggle to replace Russian exports due to the invasion of Ukraine in February.
NLNG had said all of its upstream gas suppliers had declared force majeure, forcing it to also make the declaration.
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