- Marketers accuse billionaire of monopolistic ambition;
- Dangote vows to prioritise affordability for Nigerians
- Cooking gas prices spark monopoly fears
By Moses Adeniyi | Lagos
A new wave of tension is brewing in Nigeria’s domestic energy sector following the announcement by President of the Dangote Group, Alhaji Aliko Dangote, of plans to crash the price of Liquefied Petroleum Gas (LPG), commonly known as cooking gas. The industrialist, whose refinery recently began LPG production at scale, has vowed to intervene directly in the market if current distributors fail to pass down price benefits to consumers.
Dangote, who was speaking during a tour of the Dangote Refinery in Lekki by members of Lagos Business School’s CGEO Africa programme, stated that the high cost of cooking gas had become unaffordable for ordinary Nigerians — many of whom continue to rely on firewood and kerosene for domestic cooking.
“We’re currently producing around 2,000 tonnes of LPG per day,” he said. “But I believe it is expensive. We’re trying to bring down the price and make it more affordable. If the distributors are not trying to bring it down, we’ll go directly and sell to the consumers.”
His remarks triggered a sharp reaction from industry operators and marketers, who view the move as an attempt to monopolise the LPG market. Currently, the price of cooking gas in Nigeria hovers between ₦1,000 and ₦1,300 per kilogramme — a burden many households struggle to bear amid a rising cost of living.
Stakeholders Push Back: “This is Monopoly in Disguise”
The move by Dangote has left actors in the value chain talking. Stakeholders as the former Chairman of the LPG and Natural Gas Downstream Group of the Lagos Chamber of Commerce and Industry, Mr Godwin Okoduwa, is among those who have criticised Dangote’s approach. In an interview with the Punch, he warned that any plan to sidestep existing distribution frameworks could upend years of gradual market development.
“The LPG industry in Nigeria grew from 70,000 metric tonnes in 2007 to over 1.3 million tonnes in 2022 — and that happened through collaboration: with the Federal Government, NLNG, and private investors,” Okoduwa noted.
“You don’t achieve sustainable growth by bulldozing the market. Yes, he has invested, but respect must be given to the ecosystem that already exists. This shouldn’t be a zero-sum game.”
He urged Dangote to channel his strength towards expanding LPG infrastructure in under-served regions like the North-East, rather than destabilising existing supply chains.
“He should go to areas with the lowest consumption — places like the North-East — and begin infrastructure rollout there. That’s how you grow the pie. The market has the potential to grow to five million tonnes if approached collaboratively,” he added.
“Unrealistic Promises” — Marketers Remain Sceptical
Also reacting, the Executive Secretary and CEO of the Nigerian Association of Liquefied Petroleum Gas Marketers, Mr Bassey Essien, expressed scepticism over the feasibility of Dangote’s plan to sell directly to consumers or to significantly reduce prices.
“It’s not realistic,” Essien asserted. “Look at petrol. Has Dangote sold it directly to consumers at a cheaper rate, as promised? The market doesn’t operate in a vacuum. There are logistical costs, distribution dynamics, and regulatory frameworks that can’t be brushed aside.”
Essien, like Okoduwa, called for inclusive dialogue between Dangote and existing market players to ensure the growth of the sector does not come at the expense of competition or business viability.
A Market Poised at the Crossroads
Analysts argue that while Dangote’s intervention could help tame rising energy costs, the structure and sensitivity of the LPG value chain demand a cautious and strategic approach. His refinery currently produces 22,000 tonnes of LPG daily, a volume that positions the conglomerate as a major influencer in the downstream space.
There is no question about the need to deepen domestic LPG use — especially in a country where per capita consumption remains as low as 5–6kg, compared to double digits in countries like South Africa and Morocco. But the core of the current dispute lies in how that growth is pursued: disruption versus collaboration.
Consideration for the Common Nigerian
For millions of Nigerian households, the implications of this tug-of-war are deeply personal. With inflation eating away at earnings and the average family struggling to afford basic commodities, the cost of cooking gas has become yet another unbearable expense. Many have already reverted to using firewood — a setback in the country’s clean energy transition efforts and a looming threat to environmental sustainability.
“We used to refill our 12.5kg cylinder for about ₦4,000,” says Chidinma, a mother of three in Benin City. “Now, it’s more than ₦15,000. Sometimes we cook with firewood. It’s not safe, but what choice do we have?”
Looking Ahead
Whether Dangote’s plan becomes a catalyst for transformation or a point of fracture in the LPG market depends largely on the path his conglomerate chooses — confrontation or collaboration. With the refinery’s full operations set to expand into petrol, diesel, aviation fuel, and Compressed Natural Gas (CNG) distribution in the coming months, the stakes could not be higher.
One thing is clear: a delicate balance must be struck between ensuring affordability for the masses and preserving the entrepreneurial spirit that has built Nigeria’s LPG industry from the ground up.