NLNG: How Cooking Gas Offtakers Profiteered, Earned N1,600/kg Markup

Nigeria LNG Limited (NLNG) has exposed significant markups by cooking gas offtakers, who allegedly profited N1,600 on every kilogram of Liquefied Petroleum Gas (LPG) purchased from NLNG. These offtakers bought the gas at approximately N800 per kg and resold it to consumers at N2,400 per kg during a recent period of scarcity. NLNG revealed this practice at its Facts & Figures Presentation in Lagos.

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What we found out is that a number of people who take products, they will put it in their terminal, and they are part of those that have created the artificial scarcity that has led to the price increase. When the product was being sold at N2,400 per kg in the market, guess how much they were lifting it from us? It was between N800 and N900 per kg.

NLNG Managing Director and Chief Executive Officer, Mr. Adeleye Falade, stated that some offtakers were deliberately hoarding products at terminals, creating artificial scarcity. This practice, he explained, pushed prices far above regulatory benchmarks, causing hardship for households across the country. The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) had previously recommended that retail prices, after transportation costs, should not exceed N1,000 to N1,200 per kg.

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So there’s also some distortion that happened on the sales side, which I know the regulators are working on right now to get control of it.

In response to these market distortions, NLNG is revising its allocation strategy. The company will now prioritize offtakers who can supply directly to retailers, moving away from those who engage in hoarding and price manipulation. This change aims to ensure a more equitable distribution of LPG and stabilize prices for consumers.

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That’s not a limitation for us… We sell all of our products. We actually have more demand than we’re able to sell. Our challenge was not that people were not able to take the product. Every cooking gas that we made, we had buyers.

Falade emphasized that NLNG has not experienced issues with infrastructure or capability to move its product to the market, with demand consistently exceeding supply. While acknowledging industry-wide infrastructure deficits, he stated they have not reached a point where NLNG's output is stranded. Annual LPG consumption in Nigeria has grown to 1.8 million tons in 2026, highlighting the increasing reliance on cooking gas as households transition from traditional fuels.

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There is an infrastructure deficit, but it hasn’t played itself to the point where we become stranded with the product that we have made. No, we haven’t seen it to that extent.