Nigeria offers several investment opportunities in a variety of industries, including gas production, financial services, and real estate. The gas industries, as well as other industries, are growing, and new investment opportunities are emerging on a daily basis. New productive industries must be formed in order for our economy to grow. This will create jobs, raw materials for our businesses, physical growth, and, most importantly, self-sufficiency. Within the petrochemical business, Liquefied Petroleum Gas (LPG) presents a fantastic investment opportunity. The LPG business was created expressly to meet the country's industrial and domestic gas needs. LPG is required in practically every element of business. For example, the automotive industry, manufacturing plants, and thermal energy generation are all in high demand. On a residential level, most households, particularly those in the middle and higher classes, increasingly rely on gas for cooking. Since firewood and kerosene stoves are quickly becoming outdated, hotels, catering companies, restaurants, and bakeries all want LPG as an alternate source of energy.

The distribution of gas products has been deregulated as a result of the record demand for LPG in Nigeria and the resulting scarcity of the product, which has resulted in abrupt and arbitrary price hikes. As a result, private individuals and businesses can now build LPG facilities. This product has been made available by the government. A 12.5kg cylinder used to cost between N3, 200 and N4, 000, which was considered excessive and unaffordable by many Nigerians. Today, the price ranges from N2,000 to N2,500, which is considered modest and affordable.
Source of the Product
This product is sourced entirely locally as a by-product of petroleum refining operations. As a result, the raw material will be supplied by our refineries in Warri, Port Harcourt, and Kaduna. Aside from refineries, several independent marketers import large quantities of LPG cooking gas to assure consistent supply to small and medium-sized gas bottling and marketing businesses. Small and medium gas filling (bottling) and marketing enterprises are now available to potential investors.
Project location
The project can be located anywhere, however, the location should be accessible but away from residential areas. Infrastructures such as good roads, proximity to the market, and skilled labor should all be taken into account.
Equipment and machine
Storage tanks, a filling shed, containers, cylinders, and a pump/compressor are all required. A facility for servicing cylinders should also be available. Gas storage tanks with fittings, filling heads and scales, a chain conveyor, pipes and valves, and fire-fighting equipment are among the machinery and equipment. Prospective investors will be given more information.
Labor requirement
Plant managers, engineers, marketing managers, accountants, supervisors, operators, drivers, and messengers, among others, will be needed. All staff should be trained in fire prevention and safety measures. At critical locations, bold warnings against the use of naked fire should be erected. The writer can provide all of the information, including the source of machinery and equipment, licensing procedures, plant layout, labor and management, filling operations, and a bankable feasibility report for potential promoters, upon request.
The capacity of the plant
The proposed plant will be capable of filling 500 of 12.5kg cylinders each day. A total of 105,000 cylinders will be filled and sold at a conservative market scenario at 75% capacity for 280 days per year. Depending on the promoters' wishes, the capacity could be reduced or raised.
Project take-off cost
A detailed feasibility study should be conducted to determine the actual cost of developing the project, taking into account the promoters' planned project site. According to our calculations, the promoters can earn about N126 million in the first year. The project's viability analysis shows that the initial investment will be repaid within the first year of operation. The reason is not implausible. Nigerians, particularly those in the country's urban centers, are now consuming significant amounts of gas. Aside from the short payback period, the NPV, IRR, and profitability index all indicate the enormous financial gains that any serious investor who takes advantage of the gas industry's investment opportunity will get.
The sudden shift by Nigerians from the use of dirty fuel such as kerosene, firewood, and charcoal to a cleaner and more environmentally friendly source of energy, which is the Liquefied Petroleum Gas (LPG) popularly called cooking gas, may have opened a new vista of investment opportunities for Nigerian entrepreneurs. Though Nigeria still ranks lowest in per capita usage of LPG with a 1.1-kilogram consumption rate behind South Africa, Morocco, and Ghana, the intervention of the Nigerian Liquefied Natural Gas (NLNG) Limited has somewhat helped Nigerians to embrace the use of LPG. Prior to the intervention of NLNG in the domestic gas market, the use of LPG was exclusively for the rich because the price was out of the reach of the common man as LPG was majorly imported with an annual consumption rate of 70,000 metric tonnes per annum. The coming on stream of NLNG broke that monopoly and afforded a lot of Nigerians to begin the use of LPG against the kerosene and other unconventional sources of energy. The incursion of NLNG into the domestic gas market equally created massive investment opportunities for local players to key into the LPG value chain business.
Nigeria, according to statistics from the Nigeria Liquefied Petroleum Gas Association (LPGA), currently consumes 385,000 metric tonnes of LPG per annum, up from the 2013 consumption of 250,000. This is even considered too low when compared with Ghana, Senegal, Cameroon, and Kenya’s utilization.
Implementation Process
To get started on this project, you'll need to do thorough feasibility studies and create a very realistic business strategy. The finance agreement will then be finalized. There are options for borrowing from certain financial institutions, which will be provided to prospective investors upon request. The writer will assist in the preparation of complete and bankable feasibility studies reports, as well as the acquisition and installation of all necessary machines and equipment, as well as test running and staff training. Despite the massive investment opportunities that abound in this sector, one area that is still largely untapped is an investment in the LPG plants. While other areas of the value chain such as the retail arm, gas accessories, and parts, investment in LPG is at its lowest ebb. This development can be said to be partly responsible for the high cost of cooking gas because there are only a few players in this sub-sector of the LPG arm of the business, with the few operators smiling to the banks on a daily basis as a result of huge returns on investment. Establishing an LPG plant cooking gas business is very profitable and you don’t have to break the bank before you can start. You will get your business set up and ready to go with almost everything necessary in place guided by the Kiakiagas. And this is a big business that anyone who is into it can be proud of. But beyond the financial requirement needed to establish an LPG plant, there are statutory regulatory guidelines that must be met before a license can be issued.

These standards are prescribed by the oil and gas industry regulator – the Department of Petroleum Resources (DPR). Application procedure According to documents made available to Daily Sun by NLPGA, prospective investors shall, in accordance with Part VI, Section 87, Sub-section (2) of the Petroleum Regulation 1967, petroleum gas plant or installation shall not be constructed or modified without approval granted by DPR. Accordingly, all applications for approval to construct/modify an LPG plant or installation shall be addressed to the Director of Petroleum Resources, giving full details of the proposals. Each application shall be accompanied by three copies of the following:

Detailed approved plans drawings showing the existing or proposed buildings on the site and the relative distances to the roadways and adjoining properties, alongside piping and instrumentation diagram of the gas filling plant and sectional design drawings of the storage tanks shall equally be provided. The LPGA document stipulates that a certificate signed by the Chief Federal/State Fire Officer or an officer authorized by him on that behalf, that he is satisfied with the proposed arrangements for the prevention of fire; a letter from the appropriate town planning authority authorizing siting of the LPG filling plant at the proposed arrangements for the prevention of fire and a piece of evidence that the company is duly incorporated by the Federal Ministry of Trade to deal in petroleum products. Other requirements include a current three-year tax clearance certificate, codes, standards, and specifications adopted in the design of the tanks, a non-destructive examination report or pressure test report of the LPG storage (pressure) tank, and an application fee of N10,000 in bank draft drawn in favor of the Federal Government of Nigeria, DPR payable on submission. This process might look complicated, however, with our knowledge, experience, and cordial relationship with the DPR officials, Kiakiagas will easily get all the required papers for you while saving your resources and without you going through the stress. Kiakiagas possess LPG implementation skills with which you can have your papers and other necessary documentation that back up your proposed LPG plant from not only the DPR but also other LPG regulating government agencies. Kiakiagas will guide and direct you to the next point of action after acquiring the necessary papers. We are good at what we do and we do not abandon our clients or upcoming entrepreneur in the field of LPG. Our reputation speaks for us in the gas industry. Now let us move on to setting up a gas plant.
Risks in LPG business According to Darlington Omeh, an investment analyst, every business has its peculiar setback and the biggest risk in the cooking gas business is fire explosion, which is very common due to the high inflammable nature of liquefied natural gas. That isn’t much problem though since it can easily be mitigated or even avoided. ‘‘To be able to curtail this, you need to be alert at all times to detect when there is leakage in those cylinders as leakage is one of the major causes of fire and explosion. You also need to buy a good fire extinguisher that can be very handy in time of minor fire outbreak,’’ he said.
Another risk in the business is government regulation. Should the government decide to increase the price of LPG today, some consumers may find it difficult to take and have to go back to using kerosene or firewood. If that happens, you lose some customers and your sales will drop. However, the government is always trying to reduce the price of cooking gas to encourage its usage and discourage deforestation. Other opportunities Another opportunity inherent in the cooking gas value chain is the sale of cylinders and accessories, which can be managed alongside the gas plant, offering a one-stop service for customers. “This is relatively the lowest profit you can make in the cooking gas business if you are in a respectable position where you get good patronage. Most people make much more than what I calculated here. So, it’s not in any way by exaggeration. “For a business, you started with N300,000, N150,000 profit is a super profit by all standards. Imagine if you invest more resources and take it higher, your profit will be much more mouth-watering. Gas companies, both the suppliers and retailers are making good money in the business,’’ he said. It is good news that more Nigerians are beginning to use cooking gas for various domestic cooking purposes. That will help decrease the problems of deforestation and help conserve the nation’s natural forests and prevent potential disasters inherent in desert encroachment such as erosion. Apart from the environmental benefits, the increased number of people, especially in urban areas, who are using cooking gas has created good business opportunities for smart entrepreneurs who can now trade on cooking gas and cooking gas equipment to make good profits.
The cooking gas business is very profitable and you don’t have to break the bank before you can start. With N300,000, you will get your business set up and ready to go with almost everything necessary in place. And this is a big business that anyone who is into it can be proud of.
Gas cylinders How exactly can one start a cooking gas business in Nigeria? Before we go into the details, let us first take a look at the profit potential in this business as well as the risks involved.
If you have been observing the news lately, there is a push by the federal government of Nigeria to deepen the usage of LPG in the country. And this push will start yielding results soon. If you have been procrastinating about starting your own cooking gas plant, this may be the reason to revisit that plan and put it back to work.
Understand LPG Demand Curve
Now imagine if we can switch another 25% of our population from House Hold Kerosene to cooking gas in the next 36 months 50% of annual consumption= of 600million kg (1.54billion Litres). Cooking gas business is a very profitable business, but just like every other en-devour of life, it comes with its own challenges. Most of the energy used for domestic cooking in Nigerian homes comes from traditional forms of energy like HHK (kerosene) which accounts for 65-70% of the energy consumption in Nigeria, LPG stands at 25%, while other fossil fuels like firewood and coals account for the remaining 5%.
Another reason is that demand does not change on a daily basis like fuel usage. Yes, cooking gas demand is not every day, but consider the demand curve if every household in the country utilizes cooking gas. Nigeria's average household size is six people, according to the United Nations. When you split 200 million by six people per family, you get 33 million people who buy cooking gas on a monthly basis. Because the demand curve is still expanding, many people are unaware of it. Positioning oneself in the market now is equivalent to purchasing Bitcoin at a price of 0.0003 dollars. Remember that this is a moving market. Exponential growth is possible.
How Mini LPG Depot Works
The issues in the Nigerian LPG market have created a massive supply vacuum that is becoming increasingly difficult to fill. NNPC, the government agency in charge of oil and gas, has never been able to close any of the supply gaps that have existed throughout the years. However, with the correct investment, this gap can be filled with a tiny LPG Depot facility by looking into existing LPG rules. The concept is to find a state or area that can meet the LPG supply demands of numerous states and set up a micro depot there. This strategic placement is your micro depot's greatest asset.
It would be a mistake to start such a project without competent direction. You'll need an expert consultant who understands the LPG supply, distribution, and retail business models from all angles. A consultant who can effectively convey the notion of a small LPG depot. Assist you in putting together a reasonable plan. Search assistance and advice on the best location for the miniature plant. Assist in the development and implementation of a successful marketing strategy. Assist in the formation and management of the appropriate team to ensure project completion. And serve as the project's advisory team leader for the duration of the project and beyond. And, when it comes to marketing, it must take place both before and after the factory is built. During the feasibility plan, a marketing plan with proper accountability of all target retail plants within the identified market should be written up. This figure is crucial in determining the project's economic potential. The Kiakiagas Nigeria Limited, which has a solid reputation for establishing gas plants that include not only LPG but also CNG/LNG, autogas, oxygen plants, and shipping, is the proper and finest option to consider. Our crew is up to the task, and we follow the DPR's instructions by using imported goods. Our staff has undergone extensive training to ensure that installations are carried out using the most up-to-date technology. We can also assist you in obtaining the appropriate permissions and ensuring that all gas pumps and dispensing systems are approved and tested extensively. KIAKIAGAS is a one-stop shop for all things gas, from pipeline to pump. As an added bonus for convenience stores, KIAKIAGAS carries leading gas pump and dispense equipment manufacturers such as Casper.

Kiakiagas Limited is a leading Gas business in Lagos, Nigeria with expertise in commercial gas pump and dispenses equipment, LPG retailing, New Gas Market development, and building of Gas Plants, and Gas strategy advisory. Supply by Kiakiagas provides LPG products and equipment for corporate and institutional clients for the project and operational needs. If you need a partner with hands-on local expertise in the Nigerian Gas space or any of our bespoke solutions/services, kindly Mail hello@kiakiagas.com to learn more.to learn more.