The Nigerian federal government has commenced payments for legacy gas-to-power debts owed to gas suppliers, with $120 million already offset between October 2023 and January 2024. This development was disclosed by Ed Ubong, the Coordinating Director of Nigeria’s Decade of Gas Programme, during the Nigeria International Energy Summit (NIES) in Abuja.
Ubong highlighted the government’s efforts to address legacy debts and improve gas production levels, indicating a positive trajectory for the industry. He noted that Nigeria has returned to its pre-2021 gas production levels, with plans to significantly increase production in the long term.
Additionally, Bala Wunti, Chief Upstream Investment Officer of the Nigerian National Petroleum Company Limited (NNPC), emphasized the continued relevance of oil and gas in powering Nigeria’s heavy industries. While acknowledging the importance of renewable energy, Wunti stressed the enduring significance of oil and gas in meeting Nigeria’s energy demands.
In response to the ongoing challenges in the sector, Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, underscored the imperative of energy transition and the need for Nigeria to leverage its abundant resources for economic development.
Furthermore, industry stakeholders emphasized the importance of addressing outstanding debts to bolster investor confidence and promote sustainable growth. Akachukwu Nwokedi, President of the Nigeria Gas Association (NGA), emphasized the need for policy mechanisms to prevent the recurrence of debt accumulation.
Meanwhile, the NNPC called for deeper collaboration among upstream operators, particularly independent producers, to address challenges hindering the effective development of divested assets in the nation’s oil and gas industry. Executive Vice President, Upstream, Mrs. Oritsemeyiwa Eyesan, highlighted the importance of collaboration and innovation in overcoming industry challenges and maximizing the potential of Nigeria’s energy sector.
The discussions at the NIES underscored the multifaceted efforts underway to address legacy debts, enhance gas production, and foster collaboration within the Nigerian oil and gas industry.