The President of Dangote Group, Alhaji Aliko Dangote, has announced an ambitious plan to reduce the cost of Liquefied Petroleum Gas (LPG), commonly known as cooking gas, across Nigeria. As part of this effort, he revealed that his refinery currently produces 22,000 tonnes of LPG daily and is ramping up production to meet domestic needs. Speaking during a recent tour of the Dangote Refinery in Lekki by members of the Lagos Business School CGEO Africa, Dangote described the current LPG pricing, ranging between ₦1,000 and ₦1,300 per kilogram, as unaffordable for the average Nigerian. He stressed that if existing distributors fail to adjust their pricing structures, he would initiate direct-to-consumer sales to crash prices and encourage a shift away from firewood and kerosene.
However, the move has drawn sharp criticism from operators within the gas sector who see it as a monopolistic threat to the current distribution network. Godwin Okoduwa, former Chairman of the LPG and Natural Gas Downstream Group at the Lagos Chamber of Commerce and Industry, voiced concerns about the long-term implications of Dangote’s strategy. According to Okoduwa, the Nigerian LPG market has grown significantly, from 70,000 metric tonnes in 2007 to over 1.3 million metric tonnes by 2022, through coordinated efforts among the Federal Government, Nigeria LNG, and independent offtakers. He argued that this growth was made possible by collaboration, not domination, and warned against allowing any player to sideline those who have built the industry’s foundation.
Okoduwa urged Dangote to adopt a more cooperative approach rather than seeking to disrupt existing players. He noted that Nigeria’s current per capita LPG consumption remains relatively low, at 5 to 6 kg, compared to double-digit levels in countries such as South Africa, Morocco, and Tunisia. He suggested that instead of focusing solely on nationwide disruption, Dangote could redirect efforts toward underdeveloped regions like the Northeast, where LPG infrastructure remains poor and uptake is minimal.
Bassey Essien, the Executive Secretary of the Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM), also expressed skepticism about the feasibility of Dangote’s plan. He questioned the practicality of selling gas directly to end-users and compared it to similar ambitions Dangote had with petrol and diesel distribution, plans that have not materialized at scale for individual consumers. Essien pointed out that while Dangote’s intentions to lower prices may be genuine, bypassing the existing market structure could lead to unfair competitive advantages.
While many consumers might welcome a reduction in gas prices, the broader industry is wary of market domination that could threaten smaller operators and the competitive health of the sector. Industry stakeholders are now calling on regulators to intervene, ensuring that market expansion and affordability goals are met without sacrificing fairness or undermining previous investments.
