The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) on Thursday, September 24, said it will stop regulating prices in the domestic gas market by September 2028, targeting a transition to a fully established willing-buyer, willing-seller framework.
Rabiu Umar, Chief Executive Officer (CEO) of NMDPRA, disclosed the plan at the gas market maturity workshop organised under the decade of gas initiative at the Petroleum Technology Development Fund (PTDF) in Abuja.
“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,” Umar said.
“Gas must be affordable for Nigerians while supporting president Bola Ahmed Tinubu’s investment reforms”.
He said the transition to a fully established willing-buyer, willing-seller framework by 2028 is in line with the Nigeria decade of gas goal to become a gas-powered economy by 2030.
The NMDPRA chief said the transition would be based on measurable conditions demonstrating the maturity of different segments of the gas market, in line with the provisions of the Petroleum Industry Act (PIA).
“Invariably, this is [the] first time that we have been bold enough to set a clear target for our gas market transition,” he said.
Umar said the PIA envisages a shift from a market largely coordinated through regulation to one increasingly driven by commercial contracts between willing buyers and willing sellers.
He said section 167 of the regulation provides for the gradual movement of the domestic gas market towards a point where price regulation can step back as commercial contracting and competition become stronger.
The NMDPRA chief said the transition must not be based on broad statements of intent but on clearly defined indicators, thresholds, and safeguards.
He identified supply availability and diversity, the number and quality of buyers and sellers, access to transportation infrastructure, strength of contracts, payment reliability, delivery obligations, market information and credible price signals as key indicators of market maturity.
Umar said Nigeria’s domestic gas supply remains tight despite the country’s vast gas resources, stressing that infrastructure development must be matched by sufficient gas molecules to utilise the infrastructure.
He also stressed the need to ensure that major gas infrastructure projects, including the Ajaokuta-Kaduna-Kano (AKK) pipeline, have sufficient gas supply to make them commercially useful.
“The focus right now is not just delivering the infrastructure, but ensuring that we have enough molecules to fill the pipeline,” Umar added.
The NMDPRA chief said the role of the regulator would also evolve as the market develops, with greater emphasis on establishing market rules, ensuring fair access, protecting competition, and monitoring market conduct.
He said sequencing the transition would require determining which market segments were ready to move first, the thresholds they must meet, and the safeguards required before liberalisation.
Umar further said the authority is close to the conclusion of the process for issuing gas distribution licences, with the exercise expected to be completed in the coming weeks.
He said qualified companies would be issued gas distribution licences in the fourth quarter (Q4) of 2026.
In March, the NMDPRA increased the price of natural gas for power generation companies (GenCos) to $2.18 per metric million British thermal units (MMBTU).
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