Nigerian Manufacturer Decries High Gas Prices, Cites $20 Million Investment

George Onafowokan, Managing Director of Coleman Technical Industries Limited, expressed strong dissatisfaction with the current pricing of gas supplied to manufacturers in Nigeria. Despite his company's significant investment of over $20 million in gas-powered electricity generation, Onafowokan stated that the prevailing gas prices are undermining industrial growth and job creation.

Onafowokan described the domestic gas pricing as a major impediment for manufacturers, particularly those who have invested in self-generation of electricity. He argued that industries generating their own power should not be charged $8.70 per thousand standard cubic feet of gas. He urged the Federal Government to lower this price to approximately $3.50 per thousand standard cubic feet, asserting that cheaper gas would reduce production costs, enhance competitiveness, and stimulate further investment.

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Manufacturers that have invested millions of dollars in gas-powered electricity generation should not be paying as much as $8.70 per thousand standard cubic feet of gas. Domestic manufacturers should have access to gas at significantly lower rates, around $3.50 per thousand standard cubic feet, to reduce production costs and improve competitiveness.

Coleman Technical Industries has invested heavily to maintain production and create jobs, yet continues to face escalating energy costs. Onafowokan believes the current gas pricing structure discourages industrial investment. He contends that lower prices would empower manufacturers to expand operations, hire more Nigerians, and compete more effectively in export markets.

While acknowledging the Federal Government's power sector reforms, Onafowokan highlighted gas pricing as a critical policy gap needing urgent attention. He also appealed to the Central Bank of Nigeria and the Ministry of Finance to bolster funding for development finance institutions, such as the Bank of Industry, to ensure affordable credit is accessible to manufacturers and small businesses. Onafowokan emphasized that manufacturing, agriculture, and trade are the most potent sectors for job creation and require targeted policy support to achieve the government's ambition of a $1 trillion economy.

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The majority of jobs will come from manufacturing, agriculture and trade. Agriculture cannot grow without manufacturing because value addition is what creates wealth and employment.