Dangote vows to slash cooking gas prices, threatens direct sales to consumers

In a move set to disrupt Nigeria’s energy sector, Alhaji Aliko Dangote, President of the Dangote Group, has announced plans to significantly reduce the price of Liquefied Petroleum Gas (LPG), commonly known as cooking gas.

He also threatened to bypass existing distributors and sell directly to consumers if market operators resist the price reduction.

Dangote’s declaration, made during a recent tour of his refinery, highlighted that the current price of cooking gas, which fluctuates between N1,000 and N1,300 per kilogram, is “expensive and not affordable for the common people,” many of whom still rely on firewood for cooking.

He revealed that the Dangote Refinery is currently producing approximately 22,000 tonnes of LPG daily and is rapidly increasing production for distribution across the Nigerian market, aligning with the national shift towards gas for cooking.

Speaking to members of the Lagos Business School CGEO Africa at the Lekki refinery, Dangote stated, “The one that we didn’t write, which you must have seen, is LPG. Currently, we do LPG of about 2,000 tonnes per day. You know Nigeria is gradually moving to the usage of LPG. But I believe it is expensive, but right now we’re trying to bring down the price and make it cheaper.”

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Issuing a clear ultimatum to current distributors, Dangote warned, “If the distributors are not trying to bring it down, we’ll go directly and sell to the consumers, so that people will now transit from firewood or kerosene to LPG for cooking.”

This strategic announcement follows earlier reports that the Dangote Group plans to commence direct distribution of petrol, diesel, and aviation fuel to marketers nationwide in August, leveraging 4,000 CNG-powered buses procured for the exercise.

Dangote’s assertive plan, however, has not been well-received by existing operators in the LPG market.

They have voiced strong opposition, expressing fears that the move could lead to a monopolization of the sector.

Godwin Okoduwa, the former Chairman of the LPG and Natural Gas Downstream Group of the Lagos Chamber of Commerce and Industry, described Dangote’s proposed direct sales as “monopolistic” in an interview.

This concern appears to be widely shared among dealers, who on Monday expressed apprehension about a single entity dominating the entire LPG value chain.