AKINWALE ABOLUWADE
Plans by Africa’s richest man, Alhaji Aliko Dangote, to crash the price of Liquefied Petroleum Gas (LPG), popularly known as cooking gas, have sparked concerns among industry marketers who fear a looming monopoly.
Dangote, President of the Dangote Group, recently announced his intention to slash the retail price of cooking gas, warning that his company may bypass existing distributors and sell directly to consumers if the price drop is resisted by current dealers.
During a recent tour of the Dangote Refinery in Lekki, Lagos, attended by local and international guests—including students of Lagos Business School CGEO Africa—Dangote decried the high cost of cooking gas, saying it had become unaffordable for ordinary Nigerians, many of whom rely on firewood.
“We’re currently producing about 2,000 tonnes of LPG daily, and we’re ramping up to 22,000 tonnes. Our aim is to reduce the price and encourage more Nigerians to switch from firewood and kerosene to gas,” he said. “If current distributors won’t help make it affordable, we’ll sell directly to end-users.”
Cooking gas currently sells for between ₦1,000 and ₦1,300 per kilogramme across the country.
However, the move has drawn pushback from marketers who allege it’s a veiled attempt at market dominance. In an interview, Godwin Okoduwa, former chairman of the LPG and Natural Gas Downstream Group of the Lagos Chamber of Commerce and Industry, described the strategy as monopolistic.
“I think it’s monopolistic. The LPG sector grew from 70,000 metric tonnes in 2007 to over 1.3 million tonnes in 2022 through collaboration among stakeholders. We must protect that ecosystem,” Okoduwa stated.
He also noted Nigeria’s per capita LPG consumption remains below 6kg, far behind countries like South Africa, Morocco, and Tunisia, which are in double digits.
In August, Dangote had procured 4,000 Compressed Natural Gas (CNG)-powered trucks to distribute petroleum products nationwide, signaling his increasing interest in disrupting downstream supply chains.
