The primary obstacles hampering the efficient supply chain of Liquefied Petroleum Gas (LPG) in Nigeria can be attributed to significant infrastructure challenges and distribution costs says an energy sector expert.

This lack of bulk storage terminals, upstream processing capacity, limited distribution and LPG jetties are influencing the volatility of LPG prices in Africa’s largest economy says Kelvin Emmanuel, an energy sector expert and co-founder/CEO at Dairy Hills.

“They are not enough LPG vessels in the country. Most parts of the LPG consumed are still imported into Nigeria from Europe. They are only two functional LPG landing jetties in Nigeria. NAVGAS and New Oil Jetty (NOJ) terminal in Lagos and then you also have Dozzy terminal in Calabar, Cross River state,” Emmanuel said in an interview on Arise Television in Lagos.

Data sourced from the National Bureau of Statistics show that LPG prices have been rising for months, but recently fell by just 7.61 percent in May.

According to Emmanuel, a lot of the LPG consumed in Nigeria is actually supplied by Nigeria Liquefied Natural Gas Company (NLNG) and is sold in dollars because NLNG has dollar obligations to shareholders in which the Nigerian government federal government has 49 percent equity in it.