Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) says Nigeria plans to end regulated pricing in the domestic gas market by September 2028, with prices expected to be determined under a willing-buyer, willing-seller framework.
Gatekeepers News reports that Rabiu Umar, chief executive officer of the NMDPRA, disclosed this on Thursday at a Gas Market Maturity Workshop organised under the Decade of Gas initiative in Abuja.
Umar said the transition would take place over a targeted 24-month period and would depend on measurable indicators showing that different segments of the gas market had attained the required level of maturity under the Petroleum Industry Act (PIA).
“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 said.
According to the NMDPRA boss, the transition is intended to move the domestic gas market away from a system largely coordinated through regulation towards one driven increasingly by commercial agreements between buyers and sellers.
He said the process would not be based solely on a policy declaration, but on specific benchmarks, thresholds and safeguards to determine whether the market was ready for deregulated pricing.
Umar identified supply availability and diversity, the number and quality of buyers and sellers, access to transportation infrastructure, contract strength, payment reliability, delivery obligations, market information and credible price signals as some of the indicators that would determine market readiness.
He also stressed the need to maintain affordability as the market moves towards commercial pricing.
“Gas must be affordable for Nigerians while supporting President Ahmed Tinubu’s investment reforms,” Umar said, adding that the transition was aligned with Nigeria’s goal of becoming a gas-powered economy by 2030.
The NMDPRA chief executive said Nigeria’s domestic gas supply remains tight despite the country’s large gas reserves, noting that infrastructure development must be matched by sufficient gas supply.
He also pointed to the importance of long-term contracts in encouraging investment in gas projects.
“For you to take an FID in a gas investment, you need to have a long-term contract,” Umar said.
The planned shift follows provisions of the Petroleum Industry Act, which envisage a gradual move towards a commercially driven domestic gas market.
Ed Ubong, coordinating director of the Decade of Gas Secretariat, said the country could achieve a willing-buyer, willing-seller gas market before the end of the first phase of the Decade of Gas programme in 2030. He said the programme was targeting an increase in gas supply to 12.6 billion cubic feet per day by 2030.
The Decade of Gas initiative has also identified 16 key infrastructure projects expected to support the expansion of the gas market, while more than 60 projects capable of creating about 15 billion cubic feet per day of gas demand have been identified.
The President of the Nigerian Gas Association, Yetunde Taiwo, said the transition should be guided by clear milestones to ensure the market develops at an appropriate pace.
“As NGA, what we would like to see really is to see those goalposts, those milestones that have been set, that makes it a realistic journey for us to say we have achieved a willing buyer, willing seller status,” she said.
The NMDPRA’s announcement sets September 24, 2028 as the target date for the domestic gas market to move towards a fully market-driven pricing framework.
