FG Holds Workshop on Gas Maturity, Targets 24-month Timeline to End Regulated Market

Decade of Gas secretariat seeks roadmap for willing buyer, willing seller market 

Emmanuel Addeh in Abuja 

The federal government yesterday set a 24-month target to transition Nigeria’s domestic gas market to a fully commercial ‘willing buyer, willing seller’ regime.

The Authority Chief Executive, Rabiu Umar, disclosed this yesterday at a Gas Market Maturity Workshop, where stakeholders across the gas value chain deliberated on the conditions and milestones required to move the market from heavy regulatory coordination towards commercial contracting and competition.

Umar said the Petroleum Industry Act (PIA), particularly Section 167, provided for a gradual transition to a market where commercial agreements between willing buyers and sellers would take precedence over price regulation.

“The journey we are starting today 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,” Umar said.

He said the transition would not be based solely on a timeline but would depend on measurable indicators, including the availability and diversity of gas supply, the number and quality of buyers and sellers, access to transportation infrastructure, the strength of commercial contracts, payment reliability, market information and the emergence of credible price signals.

Umar said Nigeria’s domestic gas market remained constrained by inadequate supply and infrastructure gaps, warning that the completion of major pipeline projects would have limited impact without sufficient gas to utilise the infrastructure.

“Completing pipelines such as the Ajaokuta-Kaduna-Kano project is important, but what is the point of having the pipeline if there is no gas to fill it?” he asked.

The NMDPRA chief executive said different segments of the domestic gas market were at varying levels of maturity and should not necessarily be transitioned to a fully commercial regime at the same time.

“We need to determine which segments should move first, what thresholds they must meet, what safeguards are required and how each segment will be monitored after transition,” he said.

According to him, the role of the regulator would also evolve as competition, infrastructure, liquidity and market information improve.

“Our focus should shift towards setting the rules of the market, guaranteeing fair access, protecting competition, watching conduct and keeping confidence in the system,” Umar said.

He disclosed that the authority had commenced consultations on draft regulations to address anti-competitive practices, describing the regulations as necessary to translate the competition provisions of the PIA into enforceable rules.

The NMDPRA boss also said the authority was working to expand domestic utilisation of Liquefied Petroleum Gas (LPG) and Liquefied Natural Gas (LNG), while supporting investments in Compressed Natural Gas (CNG), LNG and gas-fired power projects.

He stressed the need for Nigeria to increasingly utilise its gas resources domestically rather than focus predominantly on exports.

“The more LNG projects we have, the more we talk about being self-sufficient. We know where the world is in terms of gas, and we have to look at gas as part of the solution to our carbon footprint,” Umar said.

He described gas as a transition fuel, saying greater utilisation could help Nigeria reduce reliance on coal and improve energy access, particularly through distributed gas-fired power generation and reduced pressure on the national transmission network.

Umar said NMDPRA was committed to creating a predictable, coherent and transparent regulatory environment capable of attracting long-term investments into the gas sector.

“NMDPRA is fully committed to doing everything humanly possible to make sure that we incentivise and create an environment where gas investments come into the country,” he said.

Earlier, Coordinating Director of the Decade of Gas, Ed Ubong, said the workshop was expected to produce a clear roadmap for achieving a willing buyer, willing seller gas market by 2030.

Ubong said 2030 represented the first horizon of the Decade of Gas strategy, with stakeholders expected to identify critical markets and interventions required to support the transition.

He said Nigeria was targeting increased gas supply and had identified 16 key infrastructure projects required to strengthen the domestic market, including the Obiafu-Obrikom-Oben (OB3) pipeline and other major connectivity projects.

On demand, Ubong said more than 60 projects had been identified with the potential to generate about 15 billion cubic feet of gas demand per day by 2030.

“We are confident that Nigeria can get to a willing buyer, willing seller market before the end of the first horizon,” he said.

Ubong identified gas-to-power and cooking gas as critical components of a mature domestic gas market, stressing that pricing and sound economic principles must support sustainable transactions across the value chain.

Also speaking, the President of the Nigerian Gas Association (NGA) Yetunde Taiwo, said the association had consistently advocated the transition to a willing buyer, willing seller market but cautioned that the process must be guided by clear and measurable milestones.

Taiwo said Nigeria had made significant progress in the gas industry over the past decade but still had substantial work to do to achieve a mature market.

“We want to transition to an environment where there’s a free market. And with that in mind, there need to be milestones where you can assess how you are performing and whether you are moving close to that target,” she said.

She warned that transitioning too early or too late could have consequences, urging stakeholders to establish realistic milestones and deliberately track progress.

Taiwo noted that the government must provide clear policy direction, regulators must establish predictable rules, while industry leaders must continue to invest, innovate and execute.