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By Wale Sanyaolu and Okwe Obi, Abuja
The Federal Government has issued 25-year gas distribution licences to 10 companies in Lagos, Ibadan, Port Harcourt and Benin, enabling the distribution of 1.5 billion cubic feet of gas daily.
Speaking during the licence presentation in Abuja on Tuesday, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, highlighted the significance of the licences in bringing gas supply closer to Nigerians and advancing the country’s energy transformation.
“The issuance of the Gas Distribution Licence comes at a pivotal moment as we intensify efforts to harness the potential of gas as a critical resource for Nigeria’s energy transition and economic transformation,” Ekpo stated.
The licences grant exclusive rights to the firms to establish, construct, and operate gas distribution systems, ensuring non-discriminatory access to natural gas across their respective franchise zones.
The Executive Secretary of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed, revealed that over 30 companies applied for the licences, but only areas connected to the Escravos-Lagos Pipeline System (ELPS) were approved. He listed some of the successful firms, including NNPC, Shell, Central Horizon Gas Company, Falcon, Axxela, and NIPCO.
Ahmed explained that the licensed companies would distribute over 1.5 billion cubic feet of gas daily through a 1,200-kilometer pipeline network and over 500 customer stations.
“This licence regime holds a significant opportunity to support the development of our domestic gas market through the supply of gas to our energy and testing industries, industrial parks, special economic zones, embedded captive power generation, mobility CNG schemes, and other downstream gas utilization programmes,” Ahmed said.
He added, “We appreciate that this licence regime shall not only support the accelerated development of our domestic gas market but also create opportunities for profitable investment for various stakeholders, improve the socio-economic impact of gas resources across Nigeria, and support our national energy processing sectors.
“These licences are expected to lay a solid foundation for long-term growth and prosperity, unlock the full potential of our natural gas reserves, enable the development of new and tech markets, and create new sources of revenue and employment for our nation. Pipeline natural gas provides continuous supply, is cost-effective, safer, and eliminates storage challenges.”
Ahmed reaffirmed NMDPRA’s commitment to encouraging public-private partnerships to accelerate gas infrastructure development, emphasizing the government’s regulatory oversight and the Authority’s embedded mid- and downstream gas infrastructure fund to support private sector expertise and investments.
The Group Chief Executive Officer of the Nigerian National Petroleum Corporation Limited (NNPCL), Mele Kyari, disclosed that the company and its partners are set to invest $500 million in establishing five Liquefied Natural Gas (LNG) plants in Ajaokuta, Kogi State.
Represented by Ogunleye Olalekan, Executive Vice President of Gas and Power, Kyari assured the licence holders of adequate gas supply across their franchise zones. He urged stakeholders and investors to support the Federal Government’s vision of enhancing gas supply and utilization.
“The gas sector is a huge opportunity space,” Kyari noted, stressing the sector’s potential to drive economic growth and create substantial opportunities for investment and job creation.
