APPROPRIATE REGULATORY FRAMEWORK FOR LIQUIFIED PETROLEUM GAS IN

APPROPRIATE REGULATORY FRAMEWORK FOR LIQUIFIED PETROLEUM GAS IN NIGERIA PRESENTED BY DR JOSEPH I. ODUMODU, MFR DIRECTOR GENERAL STANDARDS ORGANISATION OF NIGERIA WORKSHOP ON CLIMATIC CHANGE: POPULARISING THE USE OF COOKING GAS IN NIGERIA LAGOS 4 th AUGUST, 2011

INTRODUCTION Firewood, charcoal, kerosene and LPG are the most commonly used household fuel for cooking. However, Firewood, charcoal and kerosene emit poisonous gases that are largely harmful to health and the environment unlike the clean fuel LPG. Few issues have generated as much heated debate as has the topic of climate change. Beyond the headlines and the slogans, however, businesses have found they must take steps to deal with the potential impact of climate change and with a range of potential regulatory challenges. In 2007, with growing focus on greenhouse gases and longterm environmental impacts, the standards Organisation of Nigeria began to develop standards to help business deal with climate change – related issues in the gas industry. This paper intends to address the regulatory framework for the safe use of liquefied Petroleum Gas in Nigeria.

HIGHLIGHTS OF NIGERIA Population : 155, 215, 573 (July 2011 estimate) Urban Population: 50% of total population (2010) Population Density: 167/KM 2 (2009) GDP Per Capital : 1, 389 US $ (2010 – IMF) , 1, 224 US $ (2010 – World Bank). • Total Area : 923, 168 KM 2 (2009). • Oil Producer: Eleventh largest producer of crude oil in the world. • Oil Exporter: Eight largest exporter of crude oil in the world. • •

HIGHLIGHTS OF NIGERIA CONT • Natural Gas: Seventh Natural Gas reserve holder in the world (182 trillion cubit feet) – January 2007. • Electricity: 40 percent of Nigerians have access to electricity. • Gas Flaring: Contribute 11% to world natural gas flaring. • Deficient and inefficient LPG supply chain. • Low national per capita consumption of LPG

ENERGY CONSUMPTION MIX IN NIGERIA 60% 50% 40% Series 1 30% 20% 10% 0% Oil Series 1 Natural Gas Hydro Electricity Others (Coal, nuclear and other reneweable Oil Natural Gas Hydro Electricity Others (Coal, nuclear and other reneweable 58% 34% 8% 0%

LIQUIFIED PETROLEM GAS Demand: Current consumption- 50, 000 MT /YR Govt. Projection- 1 million tonnes by 2010 Supply: Local refining (refineries and Bonny LNG) and imports. Challenges: Availability, import capacity, storage and distribution facilities.

POLICY FRAMEWORK ON COOKING GAS • FG targets 1 m tonnes by 2010 from 60, 000 tonnes in 2007. • Deforestation Policy • Gas flaring stoppage by 2020. • West African Gas Project • Trans-Sahara Gas pipeline (TSGP) between Algeria and Nigeria. • Construction of Brass LNG and OK LNG. • Increase investment in storage and distribution facilities by the private sector under the gas master plan

FUNCTIONS OF SON To organize tests and do everything necessary to ensure compliance with standards designated and approved by council To undertake investigations as necessary into the quality of facilities, materials and products in Nigeria, and establish a quality assurance system including certification of factories, products and Laboratories To ensure reference standards for calibration and verification of measures and measuring instruments. To foster interest in the recommendation and maintenance of acceptable standards by Industry and the general public

FUNCTIONS OF SON Cont Advise departments of governments of the Federation or a state on specific problems relative to standards specifications Sponsor such national and international conferences as it may consider appropriate Co-ordinate all activities relative to it’s functions throughout Nigeria and to cooperate with corresponding national or international organizations in such fields of activity as it considers necessary with a view to securing uniformity in standards specifications Undertakes any other activity likely to assist in the performance of its functions

HOW ARE THESE FUNCTIONS ACHIEVED? • Standardization: Standards elaboration, adoption/adaption, harmonization • Quality assurance: product certification (SONCAP, MANCAP) systems certification, Management systems trainings • Testing: Laboratory test and analysis • Metrology: Assuring measurements are accurate and thus valid

HOW ARE STANDARDS DEVELOPED IN SON? Highlights of key activities 1 2 3 4 5 6 SCENE 3 ANIMATED Request for standard/code Project approval Setup technical committee Draft standard elaborated Draft circulated for public comments Final draft circulated after review of public comments

STATUTORY REQUIREMENT FOR LPG - Standard for Liquefied Petroleum Gas (LPG) – NIS: 555 : 2007 - Specification for Refillable Liquefied Petroleum Gas Cylinders for LPG Gas – Periodic requalification NIS : 69 : 2006. - Transportationable Refillable welded Steel Cylinders for LPG gas – Periodic Requalification NIS: 532 : 2006 - Code of practice for the transportation and storage of LP Cylinders

FACILITY STANDARD • Specification for Refillable Liquefied Petroleum Gas (LPG) Cylinders – NIS 69 : 2006

LPG REGULATIONS • Harmonized Cylinders Sizes -3 kg, 6. 25 kg, 12. 5 kg, 25 kg, 50 kg. • Cylinder Exchange Pool – Facilitate collection and return of cylinders to owners/fillers. • Import permit for LPG Cylinders under SONCAP regime. • Registration of Cylinders with SON with unique identification mark and logo for product traceability.

LPG REGULATIONS CONT • Petroleum businesses licensed by Department of Petroleum Resources (DPR). • Import Permit for LPG import by Department of Petroleum Resources (DPR). • Construction of LPG tank permit by SON. • Construction of LPG filling plants by DPR, Local Government Councils and States Environmental Protection Authority. (Section 2 of the Environmental Impact Assessment Act of 1992 and environmental guidelines and standards for the petroleum industry in Nigeria(2002) published by DPR)

LPG REGULATIONS CONT • Monitoring and Enforcement of Standards By DPR and SON.

KEY BENEFITS FROM COOKING GAS USAGE/REGULATION • Contribute less to greenhouse effect. • Contribute to conservation of forests – Discourage use of charcoal and firewood (biomass). • More environmentally friendly than use of kerosene as cooking fuel. • Safe in use (smoke does not have pollutants that contributes to respiratory illness, pronounce in rural homes) • Available in Urban Areas. • Cost effective.

WAY FORWARD • Construction of more LPG refilling plants to aid availability. • Improvement of the supply chain through refinings and public awareness on benefits of use of LPG. • Implementation of stoppage of Gas Flaring Policy by 2020 by Oil Companies. • Implementation of deforestation Policy to conserve our forests.

WAY FORWARD CONT • Constructive engagement with Government by Environmental Campaign Groups. • Elaboration of Standard for “ Guide for Disclosure of Environmental Liabilities attributed to Climatic Change”. • Elaboration of Standard for “ Guide for Basic Assessment and Management of Greenhouse Gases. • Affordability of cooking gas.

WAY FORWARD CONT • Investment in LPG sector should focus on cylinder supply, haulage services or trucking.

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