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Importation of Liquified Petroleum Gas Cylinder in Nigeria; The Opportunities

Petroleum products are among the most valuable natural resources abundantly available in our country. Nigerians and people everywhere use petroleum products as a fuel in their automobiles, generating sets, industrial plants and for cooking purposes, thus making petroleum products an essential commodity that is needed for the daily operations of individual, industrial and national activities.

With huge gas reserves of one hundred and eighty-five (185,000,000,00) trillion cubic feet and the Nigerian government’s strong commitment to developing the gas industry through the Gas Master Plan, there are a lot of emerging opportunities for investors in the sub- sector.

Liquefied Petroleum Gas (LPG) is used as fuel for cooking and heating in the manufacturing Industry. It is also used for power generation.

L.P.G or Liquefied Petroleum Gas is the general name for propane (C3 H8) and butane gases (C4 H10), either stored together at varying percentages or separately. Butane usually comes in blue cylinders, while propane comes in red cylinders if stored separately.

As a fuel, L.P.G has several advantages over other fuels, including:

Weight and portability- Though heavier than air, L.P.G is approximately just half the weight of water, thus making it easier to be stored in pressure cylinders and tanks and hence, could easily be transported over long distances.

Cleaner- L.P.G burns cleanly and virtually without any soot as it mixes completely with air, which creates a perfect combustion with low carbon and sulphur emissions.

Odourless- Compared to other fuels, L.P.G is an odourless fuel. However, some suppliers usually add odorants in order for leakages to be easily perceived and detected.

Non- toxic- L.P.G is non- toxic. Prolonged and sudden exposure to it in reasonable quantity could however, cause cold burns and suffocation.

Cheaper- Compared to other fuels and even electricity, L.P.G is more cost effective.

Complexity and maintenance- L.P.G installations are less complicated, easy to maintain and even requires less maintenance.

With less than one kilogram per capita consumption, Nigeria ranks among the lowest liquefied petroleum gas consuming states in Africa despite its huge gas resources.

Although, the market is currently fraught with decayed infrastructure, the five- year growth projection of the Federal Government, according to experts, will attract investment across the LPG value chain from storage, logistics, to filling plants and cylinders, among others.

Liquefied Petroleum Gas (LPG) cylinder is an essential item for filling liquefied petroleum gas used for cooling purpose. Liquefied Petroleum Gas (LPG) cylinder consisting of 3 main parts: body, foot ring and valve guard ring.

The body of LPG cylinder is deep drawn in two pieces then these are welded together to make a compact unit without any leak and defect etc. The liquefied petroleum gas (LPG) cylinder can be produced in 3 KG, 6.25 KG, 12.5 KG and 50 KG capacities.

To ascertain the quality, safety and performance certain regulations are applicable such as NIS 69: 2006 standardization. The LPG Cylinder is regarded by the Standard Organisation of Nigeria (SON) as a high risk item of import due to its use in gas storage for domestic cooking and several other purposes. For this reason, SON has taken measures to ensure that the item passes through repeated scrutiny before being imported into Nigeria.

Today, Nigeria consumes 100, 000MT per annum and we have about 130 Liquefied petroleum gas (LPG) plants and 7,000 retailing outlets. If we can move the consumption level up to 750,000MT per annum, we expect to have about 250 LPG plants and 74,970 retailing outlets. About 2.5 mn cylinders are estimated to be in the country and over 70% of this volume are imported.

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At Foraminifera Market Research (www.foramfera.com), we provide bespoke and up to date market research reports. Our reports are designed to assist start-ups to understand the legal and financial requirements of starting the business, the market trends vis-a-vis demand and supply, competition, risk identification and mitigation strategies.

You can purchase our reports on the following subject matter

LIQUIFIED PETROLEUM GAS (LPG) CYLINDER PRODUCTION IN NIGERIA; THE FEASIBILITY REPORT
ESTABLISHING A LIQUIFIED PETROLEUM GAS (LPG) PLANT IN NIGERIA; THE FEASIBILITY REPORT
LIQUIFIED PETROLEUM GAS (LPG) REFILLING AND DISTRIBUTION IN NIGERIA; THE FEASIBILITY REPORT
ESTABLISHING A SKID MOUNTED LIQUIFIED PETROLEUM GAS (LPG) PLANT IN NIGERIA; THE FEASIBILITY REPORT

Access our other Market Research Reports or investment opportunities in Nigeria by clicking on the link below

MARKET RESEARCH REPORTS IN NIGERIA
INVESTMENT OPPORTUNITIES IN NIGERIA

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