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Lagos Gas Explosions raise Safety Concerns

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  • Lagos Gas Explosions raise Safety Concerns

Following the gas explosions in Lagos this week, the issue of safety in the Liquefied Petroleum Gas subsector is taking centre stage, with industry stakeholders expressing concerns over the existing safety gaps as the drive to boost cooking gas consumption gains momentum.

On Monday, two people died after a gas leakage triggered an explosion in a cooking gas plant owned by Second Coming Limited on CMD Road, Ikosi-Isheri. It was reported that while officials of the Lagos State Fire Service were assisting to fix the gas leakage in the plant, the exhaust pipe of a speeding vehicle triggered an explosion.

Also on that day, five residents were killed after an oxygen gas transload went awry in a retail shop in Agara, Badagry.

In August last year, four persons were killed and many injured at Obosi in Idemili North Local Government Area of Anambra State following a cooking gas explosion at Trinity Gas Limited station.

The Executive Secretary, Nigerian Association of Liquefied Petroleum Gas Marketers, Mr. Bassey Essien, stressed the need for safety consciousness in the LPG sector.

“We have to be safety conscious and put all the safety parameters in place, and especially with the nature of the product, we need to be very safety conscious and create the awareness among the customers. We cannot play down on safety,” he said.

“There are a lot of gaps in the LPG sector and most of the gaps exist because of the low level of Nigeria’s socioeconomic development,” the National Chairman, Liquefied Petroleum Gas Retailers Branch of the Nigeria Union of Petroleum and Natural Gas Workers, Mr. Michael Umudu, said.

According to him, there is a large number of substandard and imported second-hand equipment and accessories in the system.

He said, “Most, if not all, LPG materials and equipment are sourced outside the country and owing to the depreciating value of naira, many importers prefer countries that compromise universally acceptable standards. Most of the LPG plant storage facilities are brought into the country after they have been used in Europe, North America and other parts of the world.”

Umudu said the leadership of their branch union had often raised the alarm that special attention should be given to accessories, equipment and materials used for the LPG because of the volatile nature of the product.

He said the proliferation of cooking gas retail outlets in the country had made it difficult for effective supervision and enforcement.

“It also leads to the involvement of people who are not qualified to do the business. This is the greatest challenge facing our branch union in the recent times. People who know little to nothing about the LPG retailing business are daily flocking into the business. It leads to the proliferation of substandard and fake products,” he added.

According to Umudu, the LPGAR’s key programme this year is to fight this menace because they dent the association’s image and endanger the lives of customers and neighbours.

He said, “We are already having meetings with the relevant agencies in order to sanitise the system. We are determined to ensure that henceforth anybody entering into the business meets the DPR requirements. We have also mandated those who have been in the retail business but don’t meet the requirement that they should upgrade or face severe sanctions.”

Meanwhile, the Director, Department of Petroleum Resources, Mr. Mordecai Ladan, during an inspection of the Second Coming gas plant in Lagos on Wednesday, said the DPR had commenced an inquest into the Monday fire incident.

Describing the incident as “very devastating,” he said, “The inquest will determine the cause of the incident and what next to do.”

He added, “There was no structure here when the plant was given licence for operation in 1996. We are saying this to let the people know that the facility had been located here before the residents started building their houses. The whole place was bushy when they started operation; it wasn’t like this before.”

He said most times, gas plant fire incidents were as a result of poor management attitude or lack of corrective measures.

Ladan said, “The department always holds a quarterly interactive forum with the association of cooking gas plants’ owners to warn them of fire incident especially during harmattan period.”

At the 2017 Annual General Meeting of the DPR’s Lagos zonal office in November, the Controller, Lagos Zonal Operations, Mr. Wole Akinyosoye, highlighted the growth in the downstream gas market, with more gas plants, gas skids and gas retail outlets.

He said the depot LPG storage capacity in Lagos increased from 6,000 metric tonnes in 2014 to 30,000MT in 2017, with more capacity expansion underway.

He, however, noted that the exponential activities in the LPG market had come with growing challenges, especially on safety.

Akinyosoye said, “Illegal gas plants and skids are mushrooming and more people are rushing into the gas business without taking time to familiarise themselves with the modus operandi on skills and statutory requirements for entry and operations. This has led to increasing fire incidents and near-misses in recent times.”

Citing a recent explosion (early last year) in a gas skid in Ogun State that led to the loss of six lives, he said subsequent inquest by the DPR revealed that it was an avoidable accident.

Akinyosoye said, “We also found out that the lives could have been saved had the minimum safety procedures been followed and the DPR involved in the events leading to the operations in the facility, as prescribed by law. Recently, another gas explosion had occurred somewhere in sub-urban Lagos, where three people were wounded and one very critically.”

He said the DPR had been shutting illegal gas facilities with the support of the security agencies, especially the National Security and Civil Defence Corps.

“Illegal operators should prepare for more shutdown and stricter measures in the coming year, as only the DPR-licensed operators would be allowed in the oil and gas sector to engender safe operations,” he added.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Federal Government Set to Seal $3.8bn Brass Methanol Project Deal in May 2024

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The Federal Government of Nigeria is on the brink of achieving a significant milestone as it prepares to finalize the Gas Supply and Purchase Agreement (GSPA) for the $3.8 billion Brass Methanol Project.

The agreement to be signed in May 2024 marks a pivotal step in the country’s journey toward industrialization and self-sufficiency in methanol production.

The Brass Methanol Project, located in Bayelsa State, is a flagship industrial endeavor aimed at harnessing Nigeria’s abundant natural gas resources to produce methanol, a vital chemical used in various industrial processes.

With Nigeria currently reliant on imported methanol, this project holds immense promise for reducing dependency on foreign supplies and stimulating economic growth.

Upon completion, the Brass Methanol Project is expected to have a daily production capacity of 10,000 tonnes of methanol, positioning Nigeria as a major player in the global methanol market.

Furthermore, the project is projected to create up to 15,000 jobs during its construction phase, providing a significant boost to employment opportunities in the country.

The successful execution of the GSPA is essential to ensuring uninterrupted gas supply to the Brass Methanol Project.

Key stakeholders, including the Nigerian National Petroleum Company Limited and the Nigerian Content Development & Monitoring Board, are working closely to finalize the agreement and pave the way for the project’s advancement.

Speaking on the significance of the project, Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, emphasized President Bola Tinubu’s keen interest in expediting the Brass Methanol Project.

Ekpo reaffirmed the government’s commitment to facilitating the project’s success and harnessing its potential to attract foreign direct investment and drive economic development.

The Brass Methanol Project represents a major stride toward achieving Nigeria’s industrialization goals and unlocking the full potential of its natural resources.

As the country prepares to seal the deal in May 2024, anticipation grows for the transformative impact that this landmark project will have on Nigeria’s economy and industrial landscape.

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IMF Report: Nigeria’s Inflation to Dip to 26.3% in 2024, Growth Expected at 3.3%

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IMF global - Investors King

Nigeria’s economic outlook for 2024 appears cautiously optimistic with projections indicating a potential decrease in the country’s inflation rate alongside moderate economic growth.

The IMF’s revised Global Economic Outlook for 2024 highlights key forecasts for Nigeria’s economic landscape and gave insights into both inflationary trends and GDP expansion.

According to the IMF report, Nigeria’s inflation rate is projected to decline to 26.3% by the end of 2024.

This projection aligns with expectations of a gradual easing of inflationary pressures within the country, although challenges such as fuel subsidy removal and exchange rate fluctuations continue to pose significant hurdles to price stability.

In tandem with the inflation forecast, the IMF also predicts a modest economic growth rate of 3.3% for Nigeria in 2024.

This growth projection reflects a cautious optimism regarding the country’s economic recovery and resilience in the face of various internal and external challenges.

Despite the ongoing efforts to stabilize the foreign exchange market and address macroeconomic imbalances, the IMF underscores the need for continued policy reforms and prudent fiscal management to sustain growth momentum.

The IMF report provides valuable insights into Nigeria’s economic trajectory, offering policymakers, investors, and stakeholders a comprehensive understanding of the country’s macroeconomic dynamics.

While the projected decline in inflation and modest growth outlook offer reasons for cautious optimism, it remains essential for Nigerian authorities to remain vigilant and proactive in addressing underlying structural vulnerabilities and promoting inclusive economic development.

As the country navigates through a challenging economic landscape, concerted efforts towards policy coordination, investment promotion, and structural reforms will be crucial in unlocking Nigeria’s full growth potential and fostering long-term prosperity.

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South Africa’s March Inflation Hits Two-Month Low Amid Economic Uncertainty

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South Africa's economy - Investors King

South Africa’s inflation rate declined to a two-month low, according to data released by Statistics South Africa.

Consumer prices rose by 5.3% year-on-year, down from 5.6% in February. While this decline may initially suggest a positive trend, analysts caution against premature optimism due to various economic factors at play.

The weakening of the South African rand against the dollar, coupled with drought conditions affecting staple crops like white corn and geopolitical tensions in the Middle East leading to rising oil prices, poses significant challenges.

These factors are expected to keep inflation relatively high and stubborn in the coming months, making policymakers hesitant to adjust borrowing costs.

Lesetja Kganyago, Governor of the South African Reserve Bank, reiterated the bank’s cautious stance on inflation pressures.

Despite the recent easing, inflation has consistently remained above the midpoint of the central bank’s target range of 3-6% since May 2021. Consequently, the bank has maintained the benchmark interest rate at 8.25% for nearly a year, aiming to anchor inflation expectations.

While some traders speculate on potential interest rate hikes, forward-rate agreements indicate a low likelihood of such a move at the upcoming monetary policy committee meeting.

The yield on 10-year bonds also saw a marginal decline following the release of the inflation data.

March’s inflation decline was mainly attributed to lower prices in miscellaneous goods and services, education, health, and housing and utilities.

However, core inflation, which excludes volatile food and energy costs, remained relatively steady at 4.9%.

Overall, South Africa’s inflation trajectory underscores the delicate balance between economic recovery and inflation containment amid ongoing global uncertainties.

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