FG sets September 2028 deadline to end regulated gas pricing

Nigeria is targeting a willing-buyer, willing-seller domestic gas market by September 2028, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has said. The regulator fixed September 24, 2028, as the transition date, subject to supply, infrastructure and competition conditions.

The move is provided for under the Petroleum Industry Act. Under the arrangement, commercial contracts and negotiations between buyers and sellers will increasingly set gas prices instead of regulated pricing, ending years of government-controlled rates in the domestic market.

Nothing automatic about the deadline

NMDPRA Chief Executive Rabiu Umar said the transition would not simply be triggered by the September 2028 deadline. Regulators will first assess whether different segments of the market are mature enough.

The indicators include adequate and diverse gas supply, sufficient numbers of buyers and sellers, access to transportation infrastructure, reliable payments, strong commercial contracts and credible price signals.

Umar acknowledged that domestic gas supply remains tight despite Nigeria's substantial gas resources. Infrastructure development, he said, must be accompanied by sufficient supply to make projects such as the Ajaokuta-Kaduna-Kano gas pipeline commercially viable.

Cooking gas prices climb again

The announcement lands at a sensitive moment for households. Recent market checks showed retail Liquefied Petroleum Gas (LPG), commonly called cooking gas, selling for about ₦1,600 per kilogramme in parts of Lagos, around ₦1,500/kg in Osun and about ₦1,300/kg in Oyo.

At ₦1,600 per kilogramme, filling a 12.5kg cylinder costs about ₦20,000. That adds pressure to household budgets already stretched by higher petrol, transport and food costs.

The increase reverses some of the relief recorded earlier in the third quarter. LPG prices had fallen sharply from June highs as improved depot supply and higher domestic production eased shortages.

An earlier report noted that cooking gas had climbed to about ₦1,500 per kilogramme from ₦1,200, a 25 per cent increase. Diesel also moved higher across major depots, with Automotive Gas Oil (AGO) selling above ₦2,000 per litre at several locations and reaching as high as ₦2,300 per litre at some retail outlets.

Licences, supply and 2030 targets

The government plans new gas distribution licences for qualified companies in the fourth quarter of 2026 to deepen competition and improve distribution. It is also pushing for more domestic use of LPG, compressed natural gas and liquefied natural gas while expanding gas-to-power projects.

Coordinating Director of the Decade of Gas Secretariat, Ed Ubong, said the programme is targeting gas supply of 12.6 billion cubic feet per day by 2030. Sixteen major infrastructure projects have been identified, alongside more than 60 projects capable of generating about 15 billion cubic feet per day of demand.

For households, affordability remains the test. A competitive market could attract investment, raise supply and improve efficiency over time, but the recent rise in LPG prices shows why supply, infrastructure and competition must be in place before regulated pricing is fully withdrawn.