FG seeks stronger gas-to-power linkages to boost electricity supply

By Obas Esiedesa, Abuja

The Federal Government has reaffirmed its commitment to strengthening Nigeria’s gas-to-power value chain as a key strategy to expand electricity supply, drive industrial growth, and reduce energy poverty.

The Minister of State for Petroleum Resources (Gas), Rt. Hon. Ekperikpe Ekpo, stated this on Tuesday while delivering his address at the National Gas Day session of the 9th Nigeria International Energy Summit (NIES 2026).

Ekpo highlighted that natural gas currently accounts for over 70 per cent of Nigeria’s on-grid electricity generation, describing it as the backbone of the country’s power sector and a critical enabler of economic development.

“With proven natural gas reserves of over 210 trillion cubic feet, Nigeria is uniquely positioned to leverage gas not just as a resource, but as a catalyst for power delivery, industrialisation, and national growth,” he said.

He stressed that while Nigeria’s gas reserves are among the largest globally, the real measure of success lies in translating those resources into megawatts delivered to homes, industries, hospitals, and schools.

Ekpo added that under President Bola Ahmed Tinubu’s Renewed Hope Agenda, gas has been prioritised as a transition fuel to guarantee reliable electricity supply while supporting climate commitments.

“As a cleaner and more affordable energy source, gas enables us to expand electricity access, deepen industrialisation, and reduce energy poverty in a pragmatic and development-focused manner,” he said.

The Minister also disclosed that a major breakthrough under the administration was the resolution of longstanding gas-to-power debts owed to producers, following presidential approval and ratification by the National Economic Council (NEC). He said settling the legacy debts has restored confidence in the domestic gas market and unlocked fresh investments for power generation.

“For decades, unpaid gas-to-power obligations discouraged investment and constrained supply. Resolving this issue has removed a major bottleneck and laid the foundation for a sustainable gas-to-power framework,” Ekpo added.

Also speaking, CE of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Engr. Saidu Mohammed, noted that Nigeria’s persistent electricity supply challenges are not due to a lack of gas resources or generation capacity, but weak commercial arrangements in the gas-to-power segment.

Mohammed explained that although Nigeria produces about 8 billion standard cubic feet of gas daily and exports significant volumes to Nigeria LNG, the domestic gas market for power generation remains underdeveloped.

He revealed that despite over 13,000 megawatts of installed generation capacity, actual power supply has stagnated around 5,000 megawatts for more than two decades, largely due to the absence of bankable and enforceable gas sales agreements. Currently, only one or two power plants have commercially viable gas contracts, he said.

Mohammed added that the Petroleum Industry Act (PIA) introduces reforms to address these gaps, prioritising domestic gas supply for power, enabling cost-reflective pricing, and strengthening regulatory oversight. He assured that NMDPRA is committed to enforcing domestic supply obligations, improving pricing transparency, and accelerating gas infrastructure development to ensure reliable and sustainable electricity generation across Nigeria.

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