16 March

The Gas Industry and Nigeria’s Liquified Petroleum Gas (LPG) Cylinder production has received an additional boost as Rungas Group and the Nigerian Content Development Monitoring Board (NCDMB), through its SPV known as Rungas Alfa FZE, breaks ground on its new facility in Alaro City, Lagos, where it will set up the second composite LPG cylinder manufacturing plant within Nigeria with an annual capacity of 800,000 Type 3 Composite Cylinders to add to its expanding portfolio.

This facility will add to the existing SPV between Rungas and NCDMB and will raise local manufacturing of LPG composite cylinders to 1.2 million per annum; and strategically position Nigeria as a continental hub for the supply of composite cylinders.

Rungas and NCDMB, last year also broke ground on its LPG composite cylinder manufacturing plant in Polaku, Bayelsa State, known as “Rungas Prime Industries”. The plant has a projected annual capacity of 400,000 cylinders per annum.

Rungas has also partnered with the Egyptian Government to produce and assist with the distribution of LPG and Compressed Natural Gas (CNG) cylinders in Egypt. The factory, located in the Egyptian Gas Industrial Park, will produce 200,000 LPG cylinders for domestic use and 130,000 CNG cylinders for automobiles.

Lanre Runsewe, the Chief Executive Officer of Rungas Group – a Nigerian gas infrastructure company pioneering the deeper penetration of LPG across Africa, said the company identified Alaro City as the perfect place for its second LPG manufacturing facility because of the unique nature of the city’s masterplan and the speed with which infrastructure was being rolled out in the new city. “As we make progress on our goal of increasing the use of LPG in Nigeria and Africa, such partnerships with business-friendly locations like Alaro City are critical,” he said. “This project is in line with the federal government’s policy aspirations for the gas sector, as encapsulated in the National Gas Policy, and also aligns with the 2019-2023 Priority Project Deliverables of the Ministry of Petroleum Resources vis a vis clusters for gas resource, rapid growth of the LPG market, development of supporting LPG infrastructure, investment and domestic growth. This new facility in Alaro City, located within a Free Trade Zone, will not only boost our local capacity for LPG cylinders but also further position Nigeria as a powerhouse within the continent”.

Minister of State for Petroleum Resources, Dr. Timipre Sylva, who was the special guest of honour at the Ground-breaking ceremony in Bayelsa, said the new manufacturing facility was another result of the various policies initiated for the sector in 2020 which was declared the ‘Year of Gas’ by the federal government. “Our 2020 strategy to drive key policies and regulatory initiatives that would enhance gas reserves growth to support domestic and export projects has resulted in various significant upgrades in our gas infrastructure development, of which deeper LPG penetration is one of them,” he said. “It is therefore my pleasure to welcome this latest investment in deepening LPG infrastructure and its contribution to the stimulation of investment opportunities and national economic development. I salute the promoters of Alaro City for building worldclass infrastructure for businesses to strive. What we have done today will not only boost the profile and economy of Alaro City and Lagos, but also that of Nigeria and remove us from the position of being one of the lowest gas cylinder producers in Africa.”

Launched in 2019, Alaro City is planned as a 2,000-hectare mixed-income, city-scale development with industrial and logistics locations, complemented by offices, homes, schools, healthcare facilities, hotels, entertainment and 150 hectares (370 acres) of parks and open spaces. Alaro City is a partnership between Rendeavour, Africa’s largest new city builder, and Lagos State, the economic and financial nerve centre of Nigeria. Among the pioneering companies in Alaro City is Starium FZE, a subsidiary of BUA Group. Others include Mantrac Caterpillar, Ariel Foods FZE, the largest and most technically advanced ready-to-eat therapeutic foods producer in Africa, and HMD.

Stephen Jennings, Founder and CEO of Rendeavour, said that Rungas joins over 35 Nigerian and multinational companies operational, designing or building their facilities in the new city. “We are proud of this partnership with Rungas and how it once again illustrates the role our cities play in catalysing their host countries’ economies via investment, manufacturing and trade,” he said. “The growth of an eco-friendly Nigerian domestic gas market is positive locally and globally.”

Ayo Gbeleyi, Chairman of Alaro City, said: “Today, Rungas Group, through this groundbreaking, are joining the ranks of visionary Alaro City Free Zone entities, and together with their partners Nigerian Content Development Monitoring Board (NCDMB), are taking another giant step into actualizing the President Muhammadu Buhari, GCFR, led Federal Government of Nigeria’s vision of making this decade “the Decade of Gas” and equally turning Nigeria into a continental hub for the supply of composite cylinders. This without doubt could not have been happening at a more auspicious time than at the take-off of the African Continental Free Trade Area (AfCFTA) with humongous opportunities for Nigerian businesses to expand trade across the continent. This event is yet another show of faith by the market in the vision of Alaro City, the Lekki Free Trade Zone and the forward-thinking Lagos State Government”.

Managing Director/Chief Executive Officer of the Nigeria Export Processing Zones Authority (NEPZA), Prof. Adesoji Adesugba, commended Rungas and NCDMB for the strides made in boosting local manufacturing of cylinders. “This new facility being built in Alaro City in the Lekki Free Zone is yet again another example of the immense contributions that free trade zones are making to economic development and the speedy industrialization of our country. Lagos, via its free trade zones, have led admirably in achieving the federal government’s agenda for industrialization and we are excited at the pace with which the numerous benefits of free trades zones are being achieved here. More companies are welcome to Alaro City.