FG Sets September 24, 2028 Deadline to End Regulated Gas Pricing
By Aboki Forex —
Nigeria will end regulated pricing in the domestic gas market by September 24, 2028. The Nigerian Midstream and Downstream Petroleum Regulatory Authority is targeting a full transition to a willing-buyer, willing-seller framework by that date.
The NMDPRA Chief Executive, Rabiu Umar, disclosed this on Thursday at the Gas Market Maturity Workshop organised under the Decade of Gas initiative at the Petroleum Technology Development Fund, Abuja.
Conditions, not statements of intent
Umar said the transition would rest on measurable conditions that demonstrate the maturity of different segments of the gas market, in line with the Petroleum Industry Act.
"Gas must be affordable for Nigerians while supporting President Ahmed Tinubu's investment reforms. This transition is in line with the Nigeria decade of gas goal to become a gas-powered economy by 2030," he stated.
He said the PIA envisages a shift from a market largely coordinated through regulation to one driven increasingly by commercial contracts between willing buyers and willing sellers.
"Invariably, this is the first time that we have been bold enough to set a clear target for our gas market transition," he noted.
According to Umar, the authority is targeting a 24-month period to establish the conditions required to declare the market a fully functioning willing-buyer, willing-seller market.
"The journey we are starting should lead us to a place where we should target a 24-month at best period within which we will be able to declare the market to be truly a willing-buyer, willing-seller market."
He stressed that the transition must not be based on broad statements of intent but on clearly defined indicators, thresholds and safeguards. He listed supply availability and diversity, the number and quality of buyers and sellers, access to transportation infrastructure, strength of contracts, payment reliability, delivery obligations, market information and credible price signals as key indicators of market maturity.
Domestic supply still tight
Umar said Nigeria's domestic gas supply remains tight despite the country's vast gas resources, and that infrastructure development must be matched by sufficient gas molecules to use the infrastructure.
"If you look at supply, for example, on the domestic side, it is still tight, no matter how you look at it. We have a lot of work to do in our infrastructure space," he said.
"The focus right now is not just delivering the infrastructure, but ensuring that we have enough molecules to fill the pipeline."
He specifically stressed the need to ensure that major gas infrastructure projects, including the Ajaokuta-Kaduna-Kano pipeline, have sufficient gas supply to make them commercially useful. He said the regulator's role would also evolve as the market develops, with greater emphasis on market rules, fair access, protecting competition and monitoring market conduct.
Licences, LPG and investment
The NMDPRA chief said the authority has begun consultations on draft regulations on anti-competitive practices, aimed at translating the competition provisions of the PIA into enforceable rules. It is also nearing the conclusion of the process for issuing gas distribution licences, with qualified companies to be issued licences in the fourth quarter of 2026.
Umar said the authority is working to deepen domestic use of liquefied petroleum gas and liquefied natural gas, and to expand the use of compressed natural gas, while several LNG and gas-to-power projects are being developed. Greater domestic gas use, he said, could support power generation, reduce dependence on imports and minimise transmission losses from moving electricity over long distances.
He said gas projects require substantial upfront investment and long-term contracts before investors and financiers commit capital. "For you to take an FID in a gas investment, you need to have a long-term contract," he said.
The Coordinating Director of the Decade of Gas Secretariat, Ed Ubong, said Nigeria could achieve a willing-buyer, willing-seller gas market before the end of the first horizon of the programme in 2030. He said the programme targets gas supply of 12.6 billion cubic feet per day by 2030, with 16 key infrastructure projects expected to support market growth. More than 60 projects capable of creating about 15 billion cubic feet per day of gas demand have been identified on the demand side.
The President of the Nigerian Gas Association, Engr. Mrs Yetunde Taiwo, said the transition must be driven by clearly defined milestones.
For Nigerian businesses, the 2028 date gives gas users and investors a timeline to plan around. But with domestic supply still tight and the AKK pipeline needing molecules, the pace of liberalisation will depend on how quickly supply, infrastructure and payment discipline improve.