Nigeria produces gas, yet a significant share of its LPG is still imported. Olabode Sowunmi, CEO of Cabtree Limited, speaks to Petroleumprice.ng on LPG penetration, infrastructure readiness, and the sector's outlook, and pushes back on the idea that import dependence exposes Nigeria to price shocks: crude oil, he says, is a global commodity priced the same regardless of where it's bought, and the country's real constraint is production, not policy.
LPG penetration in Nigeria is still low compared to regional peers. What's actually stalling wider adoption: cost, infrastructure, or distribution?
It's both, honestly, and they feed into each other. When you look at neighbouring countries, it's not that they have more distribution points in absolute numbers; it's that their distribution covers a higher percentage of what they need. A big part of that gap is rural coverage and the volumes required to serve it. Nigeria produces gas, yet a significant share of our LPG is still imported.
There's also a distribution point people underestimate. Every filling station in this country has the potential to be an LPG distribution centre. That's infrastructure that already exists and isn't being used to its full capacity. So it's cost, it's distribution, and ultimately it's about the availability of the product at the volumes people need.
As a consultant who has worked closely with the Senate Committee on Gas, what do you see as the single biggest policy gap holding back Nigeria's domestic gas utilisation agenda?
There isn't really a policy gap in the way that question assumes. What's holding domestic gas utilisation back has more to do with production than with policy design. The Gas Master Plan exists specifically to drive domestic gas; it isn't a general document. The constraint is that production hasn't caught up to what the framework calls for.
How ready is Nigeria's downstream gas infrastructure (storage, pipelines, terminals) to support the government's gas expansion targets?
Think of it like asking how ready Nigeria's road network is to get goods to rural areas. Some routes are in poor condition and need repair. Some places need entirely new routes. Others need existing routes expanded. That's exactly where gas infrastructure is.
The AKK pipeline, now nearing commissioning after years of delay, is designed to extend gas supply across the northern states, and once that backbone is in place, other northern states that need gas can be reached. But this isn't really about meeting a government target. It's about meeting the needs of Nigerians, for both domestic and industrial consumption. The infrastructure has to grow to match those needs, not a target on paper.
Cabtree advises across oil, gas, and energy transition. Where do you see the clearest near-term investment opportunity in Nigeria's gas value chain?
Every part of the value chain is an opportunity. People assume opportunities are interchangeable, and they're not. What matters is the investor: their access to capital, their knowledge of that specific segment, their appetite for risk.
Someone with a strong upstream background can't simply pivot into midstream or downstream and expect the same fluency; it takes time to understand that part of the business properly. The same applies in reverse: someone coming from manufacturing or mining into oil and gas will need time before they're ready to invest upstream, even with capital in hand. There's no universally easier segment. It's entirely about the person, their expertise, and their circumstances.
What role should local refining and gas processing play in reducing Nigeria's exposure to import-driven price shocks?
The idea of an import-driven price shock is a myth. About 75% of oil industry costs come from crude oil, and crude is a commodity; its price is essentially the same regardless of where you buy it, give or take minor variation between grades. The cost of refining is also broadly consistent across markets. So when you import, aside from the importer's own margin, the cost difference isn't significant.
Look at what happened when the Strait of Hormuz closed: the global price of crude went up, and every buyer paid that higher price, regardless of whether their country imports or exports oil. That's not an import problem; that's a global commodity moving.
The real value of domestic refining isn't a cheaper product; it's jobs, and building competence and a value chain locally. Import and export are normal features of how markets work. What Nigeria actually needs is to compete effectively and balance domestic consumption so our own market functions properly and prices stay fair.
At events like the West Africa LPG Expo, what's the recurring concern from industry stakeholders that policymakers still aren't addressing?
Honestly, I'm not aware of concerns that have gone unaddressed. There may be individual grievances here and there. But policy isn't designed around individual interests; it's designed around the collective interests of the industry, which are broad by nature. Policies have consistently been aimed at strengthening businesses and improving income across the sector.
With energy transition pressure globally, how should Nigeria balance gas expansion as a transition fuel against renewable energy investment?
Why should we scale back an industry that provides roughly 75% of our national income and 90% of our foreign exchange because of external pressure around energy transition? I understand the logic of an energy mix, having solar, having wind, as complementary options, and those can absolutely be good additions. But reducing our core income to chase that mix doesn't add up for me.
It's also worth noting that a lot of the countries pushing hardest on energy transition are themselves running into real problems with their own industrialisation. Renewables have a place. The question is whether we let that pressure undercut the industry that's actually building our economy right now.
Looking at the next few years, where do you see Nigeria's gas and LPG sector heading, and what needs to happen now to get there?
The plan already exists: the Nigerian Gas Master Plan, anchored on producing more gas. That's what's driving the current push for more drilling, more exports, and the incentives being extended to international companies.
Alongside that, there's a parallel need for better infrastructure to hit domestic targets. At the end of the day, it comes down to continuing what's already in motion: building out infrastructure and strengthening the model for domestic consumption. If we stay consistent on both fronts, I think we'll get to where we need to be.