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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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Nigeria’s N3.3tn Power Sector Rescue Package Unveiled

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President Bola Tinubu has given the green light for a comprehensive N3.3 trillion rescue package.

This ambitious initiative seeks to tackle the country’s mounting power sector debts, which have long hindered the efficiency and reliability of electricity supply across the nation.

The unveiling of this rescue package represents a pivotal moment in Nigeria’s quest for a sustainable energy future. With power outages being a recurring nightmare for both businesses and households, the need for decisive action has never been more urgent.

At the heart of the rescue package are measures aimed at settling the staggering debts accumulated within the power sector. President Tinubu has approved a phased approach to debt repayment, encompassing cash injections and promissory notes.

This strategic allocation of funds aims to provide immediate relief to power-generating companies (Gencos) and gas suppliers, while also ensuring long-term financial stability within the sector.

Chief Adebayo Adelabu, the Minister of Power, revealed details of the rescue package at the 8th Africa Energy Marketplace held in Abuja.

Speaking at the event themed, “Towards Nigeria’s Sustainable Energy Future,” Adelabu emphasized the government’s commitment to eliminating bottlenecks and fostering policy coherence within the power sector.

One of the key highlights of the rescue package is the allocation of funds from the Gas Stabilisation Fund to settle outstanding debts owed to gas suppliers.

This critical step not only addresses the immediate liquidity concerns of gas companies but also paves the way for enhanced cooperation between gas suppliers and power generators.

Furthermore, the rescue package includes provisions for addressing the legacy debts owed to power-generating companies.

By utilizing future royalties and income streams from the gas sub-sector, the government aims to provide a sustainable solution that incentivizes investment in power generation capacity.

The announcement of the N3.3 trillion rescue package comes amidst ongoing efforts to revitalize Nigeria’s power sector.

Recent initiatives, including tariff adjustments and regulatory reforms, underscore the government’s determination to overcome longstanding challenges and enhance the sector’s effectiveness.

However, challenges persist, as highlighted by Barth Nnaji, a former Minister of Power, who emphasized the need for a robust transmission network to support increased power generation.

Nnaji’s advocacy for a super grid underscores the importance of infrastructure development in ensuring the reliability and stability of Nigeria’s power supply.

In light of these developments, stakeholders have welcomed the unveiling of the N3.3 trillion rescue package as a decisive step towards transforming Nigeria’s power sector.

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Nigeria’s Inflation Climbs to 28-Year High at 33.69% in April

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Nigeria's Inflation Rate - Investors King

Nigeria is grappling with soaring inflation as data from the statistics agency revealed that the country’s headline inflation surged to a new 28-year high in April.

The consumer price index, which measures the inflation rate, rose to 33.69% year-on-year, up from 33.20% in March.

This surge in inflation comes amid a series of economic challenges, including subsidy cuts on petrol and electricity and twice devaluing the local naira currency by the administration of President Bola Tinubu.

The sharp rise in inflation has been a pressing concern for policymakers, leading the central bank to take measures to address the growing price pressures.

The central bank has raised interest rates twice this year, including its largest hike in around 17 years, in an attempt to contain inflationary pressures.

Governor of the Central Bank of Nigeria has indicated that interest rates will remain high for as long as necessary to bring down inflation.

The bank is set to hold another rate-setting meeting next week to review its policy stance.

A report by the National Bureau of Statistics highlighted that the food and non-alcoholic beverages category continued to be the biggest contributor to inflation in April.

Food inflation, which accounts for the bulk of the inflation basket, rose to 40.53% in annual terms, up from 40.01% in March.

In response to the economic challenges posed by soaring inflation, President Tinubu’s administration has announced a salary hike of up to 35% for civil servants to ease the pressure on government workers.

Also, to support vulnerable households, the government has restarted a direct cash transfer program and distributed at least 42,000 tons of grains such as corn and millet.

The rising inflation rate presents significant challenges for Nigeria’s economy, impacting the purchasing power of consumers and adding strains to household budgets.

As the government continues to grapple with inflationary pressures, policymakers are faced with the task of implementing measures to stabilize prices and mitigate the adverse effects on the economy and livelihoods of citizens.

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FG Acknowledges Labour’s Protest, Assures Continued Dialogue

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Power - Investors King

The Federal Government through the Ministry of Power has acknowledged the organised Labour request for a reduction in electric tariff.

The Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) had picketed offices of the National Electricity Regulatory Commission (NERC) and Distribution Companies nationwide over the hike in electricity tariff.

The unions had described the upward review, demanding outright cancellation.

Addressing State House correspondents after the Federal Executive Council (FEC) meeting on Tuesday, Minister of Power, Adebayo Adelabu, said labour had the right to protest.

“We cannot stop them from organizing peaceful protest or laying down their demands. Let me make that clear. President Bola Tinubu’s administration is also a listening government.”

“We have heard their demands, we’re going to look at it, we’ll make further engagements and I believe we’re going to reach a peaceful resolution with the labor because no government can succeed without the cooperation, collaboration and partnership with the Labour unions. So we welcome the peaceful protest and I’m happy that it was not a violent protest. They’ve made their positions known and government has taken in their demands and we’re looking at it.

“But one thing that I want to state here is from the statistics of those affected by the hike in tariff, the people on the road yesterday, who embarked on the peaceful protests, more than 95% of them are not affected by the increase in the tariff of electricity. They still enjoy almost 70% government subsidy in the tariff they pay because the average costs of generating, transmitting and distributing electricity is not less than N180 today.

“A lot of them are paying below N60 so they still enjoy government’s subsidy. So when they say we should reverse the recently increased tariff, sincerely it’s not affecting them. That’s one position.

“My appeal again is that they should please not derail or distract our transformation plan for the industry. We have a clearly documented reform roadmap to take us to our desired destination, where we’re going to have reliable, functional, cost-effective and affordable electricity in Nigeria. It cannot be achieved overnight because this is a decay of almost 60 years, which we are trying to correct.”

He said there was the need for sacrifice from everybody, “from the government’s side, from the people’s side, from the private sector side. So we must bear this sacrifice for us to have a permanent gain”.

“I don’t want us to go back to the situation we were in February and March, where we had very low generation. We all felt the impact of this whereby electricity supply was very low and every household, every company, every institution, felt it. From the little reform that we’ve embarked upon since the beginning of April, we have seen the impact that electricity has improved and it can only get better.”

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