The Federal Government has increased the price of natural gas supplied to power generation companies to $2.18 per metric million British thermal units (MMBTU).
The Nigerian Midstream and Downstream Petroleum Regulatory Authority disclosed that the new tariff will take effect from April 1, 2026.
In a circular issued on Tuesday, the regulator said the revised rate reflects an increment of $0.05 from the previous price of $2.13/MMBTU.
It also announced an update to the Domestic Base Price for gas in the local market, fixing it at $2.18/MMBTU as the minimum benchmark for domestic sales.
Similarly, wholesale gas prices for commercial consumers were adjusted upward to $2.68/MMBTU from $2.63/MMBTU.
The authority further stated that gas-based industries, including ammonia, urea, methanol and low-sulphur diesel producers, will operate within a pricing band of $0.9/MMBTU as the floor and $2.18/MMBTU as the ceiling.
Power sector concerns
The increase is expected to exert additional pressure on Nigeria’s already fragile power sector, particularly on generation companies.
The development comes amid ongoing concerns by GenCos over persistent gas supply constraints, largely attributed to outstanding debts owed to gas suppliers.
The Chief Executive Officer of the Association of Power Generation Companies had recently put the government’s indebtedness to its members at about N6tn, a figure disputed by the Minister of Power, Adebayo Adelabu.
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Industry stakeholders warn that the latest upward review in gas pricing could further deepen the sector’s gas supply challenges and worsen electricity generation shortfalls across the country.
