Charcoal is killing Nigerians as the Nation’s Gas Industry enters ‘Bermuda Triangle’
By Bello M. zaki
The Vice President of Nigeria, Prof. Yemi Osinbajo, said about 100,000 Nigerians die annually due to hazardous cooking habit; that an estimate of 600,000 Nigerians have died in the past six years under President Muhammadu Buhari, since he assumed office in May 2015. The Vice President made the statement in mid-March 2022 when he travelled to Dubai, United Arab Amirates, for the World Liquefied Petroleum Gas Association forum conference: “Thousands of Nigerians die as a result of inefficient cooking practices using polluting stoves paired with solid fuels like charcoal and kerosene,” he said on his Facebook page.Osinbajo was reacting to a news report from the World Health Organization (WHO), that said 4.3 million people in the world die annually from inefficient cooking practices, and that according to him “about 100,000 of this unfortunate statistic are Nigerians.” That the use of hazardous fuels for cooking is “third highest killer in Nigeria after malaria and HIV,” he therefore suggested that: “The need to transition from these fatally hazardous fuels to cleaner energy is exigent, and there is an easy answer: initiating conversations that will ensure sustainable availability and access to Liquefied Natural Gas (LNG) and Liquefied Petroleum Gas (LPG), like the one we are gathered for today at this year’s LPG Week 21.”
Many Nigerians aware of the VP’s promise, including yours sincerely, awaited earnestly for the return of the VP and look forward to the day that he would initiate the conversation that would ensure the sustainable availability and accessibility of this essential product, particularly bearing in mind the astronomical rise of cooking gas prices in the country: The price of cooking gas in Nigeria in the last seven years has risen by 234% between May 29, 2015 to December 24th 2022 (The Punch newspaper, 24th December 2022 @ https://punchng.com/lpg-price-soars-by-232-in-seven-years/).
His Excellency had since returned to the country and nothing had so far been heard about attending to the issue of the availability of affordable cooking gas in the country, and his administration is about to end in few weeks to come; besides, the nation’s Federal Executive Council had on the 28th of June 2017 approved a new National Gas Policy (NGP) to replace the 2008 Nigeria Gas Masterplan that could amongst other things, resolve the pressing cooking gas problems.
The NGP was intended to move Nigeria from a crude oil export-based economy to a gas-based industrial economy, bearing in mind that Nigeria has more gas reserves than oil, as it has a proven gas reserves of 208 trillion cubic feet (tcf), being the 9th largest gas reserve in the world, and the highest proven reserve in Africa. Nigeria also has associated gas that is being released and flared while exploring crude petroleum that could also be used as cooking gas and provision of electricity. Experts say, the amount of gas being flared in Nigeria is enough to provide electric power 24/7 to Trinidad and Tobago, a country with a population of 1.4 million people, for a year. But despite this huge availability of the product in the country, 60% of the cooking gas being utilized in Nigeria, is being imported. (BusinessDay newspaper Editorial of Dec 21, 2021 @ https://businessday.ng/editorial/article/nigeria-gas-policy/).
To reduce and utilize the associated gas being flared, the Federal Executive Council approved the Nigerian Gas Flare Commercialisation Programme (NGFCP) and was launched by the Minister of State for Petroleum Resources on December 13, 2016. The programme was designed to offer the gas being flared to intending buyers through bidding, and prospective buyers immediately submitted their bids, only for the programme to be suspended and relaunched six years after in October 2022.
Also, nothing was herd about the approved Gas Policy till on May 29, 2021, four years after the approval, when the federal government declared a ‘Decade of Gas’ when President Buhari said the initiative was part of his administration’s resolve to prioritise the utilisation and development of gas in the country: The most important aspect of the policy goals is the National LPG Expansion Programme that intends to increase the domestic utilization of LPG. Vise-President Osinbajo emphasized that the government’s aim was to increase LPG domestic consumption from 5% to 90% in 10 years, thus moving Nigerians away from using harmful cooking fuels to LPG, which he described as a “cleaner and more efficient energy”.
According to WHO, household air pollution from the inefficient use of solid fuels such as charcoal lead to premature death as a result of the following illnesses: 12% of such death is as a result of pneumonia; 34% from stroke; 26% from ischaemic heart disease; 22% from chronic obstructive pulmonary disease (COPD), and 6% from lung cancer. Therefore, in Nigeria, the federal government and health NGOs have recommended Liquefied petroleum gas (LPG) otherwise known as cooking gas, as much healthier option than other means of cooking in the country, LPG being a mixture of two hydrocarbons (butane and propane) that have low carbon-to-hydrogen ratio, therefore contributes little to global warming. Therefore, in 2019, the Federal Ministry of Petroleum Resources made its LPG Penetration Programme a component of the country’s package for achieving Paris Agreement for reducing annual greenhouse gas emissions by 2020.
Speaking during an online conference on Nigeria’s LPG Assembly in June 2020, the Programme Manager of National LPG Expansion and Implementation Plan, Office of the Vice President, Mr. Dayo Adeshina, lamented that LPG was only being used by 5% of the population in Nigeria; that 60% of Nigerians were using firewood to cook; 30% uses kerosine, while 5% uses charcoal, but the use of LPG in the country had risen from 70,000 metric ton (MT) in 2007 to over a million MT in 2019.
The Nigeria Liquified Natural Gas Ltd. (NLNG), a subsidiary of the Nigeria National Petroleum Company (NNPC) Ltd. that produces LPG, said in October 2021 that it had increased the supply of the product by 1000% in the last 14 years, from 600,000 mt in 2007 to 1.3 million mt in 2021. But still, scarcity that leads to importation, and the 7.5 Value Added Tax (VAT) the federal government imposed on cooking gas, had led to the incessant rise in the price of the product in the country. Professor Osinbajo, who read the Keynote Address at the World LPG Association conference at the 2021 LPG Week held in Dubai between 5 – 9 December 2021, said Nigeria needed an investment outlay of US$6 billion in gas infrastructure to provide 5 million mt for targeted consumers in 2022, and to foster net-zero carbon emission.
Therefore, the continuous rise in the price of cooking gas and other cooking fuel such as kerosine and electricity is pushing more people into using charcoal as cheaper and affordable cooking fuel despite its associated hazards. Data from the National Bureau of Statistics (NBS) showed that the average retail price for refilling a 12.5kg cylinder of cooking gas increased by 121.2% to N9,486 in June 2022 from the same period in 2021, while the price of kerosine in Nigeria is the highest in the world, as the price of the product was deregulated in 2012, with a litre costing N1,041.050 and a gallon costing N3,940. 801 as at 02-Jan-2023: On the same day, a litre of kerosine cost N2.388 in Iran; N96.319 in Saudi Arabia; N131.104 in Egypt; N168.006 in Kuwait, and N176.075 in Bolivia, according to globalpetrolprices.com(@https://www.globalpetrolprices.com/Nigeria/kerosene_prices/).
Electric power, the supply of which is unreliable and its tariff unpredictable in the country, was not even included in the nation’s energy mix for cooking; the recent electric power tariff increase was silently slapped on the consumers by as much as 18.5% with effect from December 1, 2022.
On the other hand, Nigeria is one of the leading gas exporting countries of the world with an annual export of 38, 464.2014 million cubic feet in 2021, its highest in the last two decades according to OPEC’s figures (CEIC @ https://www.ceicdata.com/en/indicator/nigeria/natural-gas-exports), despite scarcity and high prices in the domestic market. A lot of the products is being exported to the West African countries of Benin Republic, Togo and Ghana by the West African Gas Pipeline Company Ltd. (WAPco, owned by Chevron, Royal Dutch Shell and NNPC) that was incorporated in Bermuda in 2003, and registered in Benin, Ghana, Nigeria and Togo as a foreign company; and N-Gas Ltd. a subsidiary of the NNPC and partly owned by Shell and Chevron, that solely purchases and delivers gas to Togo, Benin Republic and Ghana through WAPco’s pipeline; it was also incorporated in Bermuda in 2004.
Coincidently (or otherwise), the two companies that dominated Nigeria’s gas industry (WAPco and N-Gas) were incorporated within one year after the West African Gas Project implementation agreement was signed in 2003 by the countries of the Economic Community of West African States (ECOWAS) to supply the ECOWAS countries with gas from Nigeria: While Bermuda, an archipelago in the western North Atlantic Ocean consisting of 7 islands, is a tax haven; a tax haven is an offshore country with extensive laws and systems that provide little or no tax obligations, but high secrecy and protection to the privacy of foreign individuals and businesses.
In April 2016, Nigerians, and indeed citizens of many other countries of the world, were rudely awakened by the exposure in the Panama papers, that uncovered among other things, the dreadful deeds of past and present Nigerian leaders in Panama, a tax haven: About 11.5 million leaked documents originating from a Panama-based law firm, Mossack Fonseca that handled offshore companies, like WAPco and N-Gas, and individuals from all over the world, including 130 Nigerian public and civil servants, legislators, businessmen, clerics, traditional rulers, ‘legal luminaries’ etc were made public.
Companies incorporated in tax haven countries are mainly shrouded in secret dealings that are not sincere, many of them, according to Premium Times newspaper (April 14,2016) “are entities that have no active businesses and usually exist only in names as vehicles for another company’s business operations. In essence, they are corporations that exist mainly on paper, have no physical presence, employ no one and produce nothing. They are frequently used to shield the identities of owners and/or to hide money.”
Therefore, the trillion-dollar gas question now is, why NNPC, a government corporation, being the major shareholder of these dominating companies (owning 25% shares in each) in the Nigerian gas industry allow them to be incorporated in Bermuda? WAPco’s headquarters is even in Ghana with only a corresponding office in Badagry, Lagos State. As a regulatory body in the gas industry, NNPC has no full access to the record of financial operations of the two companies that don’t file financial reports in Nigeria for tax purposes, as they file for tax assessment only in Bermuda; also why NNPC, a regulator should invest in an operating company to which it regulates? With the rising issues of non-metering of oil export, undocumented lifting of crude oil, non-accountability of oil revenue and non-remitting of oil proceeds in the NNPC, the issue of Nigeria’s gas industry and NNPC’s heavy involvement in these dominating Bermuda companies in the nation’s gas sector, is worth paying attention to.
Bermuda itself is synonymous with Bermuda Triangle, a mythical section of the Atlantic Ocean between Miami in the U.S.A, Bermuda and Puerto Rico where dozens of ships and airplanes have been mysteriously disappearing since the First World War. I therefore call on the Nigerian authorities to salvage the nation’s gas industry before it disappears into the Bermuda Triangle.
