KEY POINTS
- The National Economic Council has approved N185 billion to clear validated legacy debts owed to upstream gas producers, aiming to improve supply reliability to power plants.
- Minister of State for Petroleum Resources (Gas), Dr Ekperikpe Ekpo, announced that the OB3 Gas Pipeline is fully completed with a daily capacity of two billion cubic feet.
- Federal initiatives have expanded Compressed Natural Gas conversions to over 120,000 vehicles, supporting broader targets to achieve one million conversions nationwide.
MAIN STORY
The Federal Government has announced that the National Economic Council (NEC) has approved N185 billion to settle validated legacy debts owed to upstream gas producers.
Speaking at a press conference in Abuja on Friday, the Minister of State for Petroleum Resources (Gas), Dr Ekperikpe Ekpo, stated that clearing the outstanding liabilities is designed to restore commercial discipline, enhance gas supply reliability to power generation plants, and bolster investor confidence across the energy sector.
Detailing key infrastructure milestones, Dr Ekperikpe Ekpo reported that the OB3 Gas Pipeline is 100 per cent complete with pre-commissioning concluded, boasting a capacity to transport two billion cubic feet of gas daily and unlock over 500 million standard cubic feet of domestic supply per day.
Additionally, the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline has reached approximately 95 per cent completion. The minister noted that the Midstream and Downstream Gas Infrastructure Fund, backed by N671 billion in public funding, has successfully catalyzed N1.6 trillion in private investments across 31 projects and 205 assets.
The administration has maintained its broader strategic roadmap targeting $30 billion in gas investments by 2030, alongside sweeping clean-energy transitions. Compressed Natural Gas (CNG) vehicle conversions have surged from roughly 11,000 in 2023 to more than 120,000, with an ultimate target of one million converted vehicles and 1,000 refuelling stations.
Furthermore, government initiatives to expand Liquefied Petroleum Gas (LPG) access to five million households by 2030 are underway, supported by the ongoing distribution of 27,000 free gas cylinders per state and the extension of the National Grassroots LPG Penetration Programme to 2060.
To curb environmental degradation, 42 companies have been awarded contracts to harness flare gas, reinforcing Nigeria’s commitment to ending routine gas flaring by 2030.
THE ISSUES
- Clearing legacy debts within the gas-to-power value chain is vital for resolving persistent electricity generation bottlenecks and securing long-term investor participation.
- Expanding domestic gas infrastructure requires synchronizing large-scale pipeline completions with localized distribution frameworks for clean cooking and transport fuel.
WHAT’S BEING SAID
“This is not merely about settling debt. It is about restoring commercial discipline, improving supply reliability and rebuilding investor confidence.”
- Dr Ekperikpe Ekpo, Minister of State for Petroleum Resources (Gas)
WHAT’S NEXT
The Federal Government will oversee the disbursement of the approved funds to upstream producers while advancing final integration work on major domestic gas pipeline corridors.
BOTTOM LINE
The National Economic Council has greenlit N185 billion to resolve legacy gas sector debts, complementing major infrastructure milestones like the completion of the OB3 pipeline to boost domestic energy supply.
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