The Federal Government has approved the payment of ₦185 billion owed to gas producers in a major push to stabilise electricity generation and revitalise the country’s gas industry.

The approval, endorsed by President Bola Ahmed Tinubu and ratified by the National Economic Council, is aimed at addressing long-standing debts that have restricted gas supply to power plants nationwide.

According to the Ministry of State for Petroleum Resources (Gas), the settlement will be executed through a royalty-offset arrangement, ensuring gas producers recover their outstanding payments without putting undue pressure on government finances.

Officials say that clearing the legacy gas debts is critical to unlocking essential gas volumes currently constrained by financial bottlenecks. The move is expected to boost the operational capacity of power plants, restore investor confidence, and support the administration’s wider reforms in the energy sector.

The initiative forms part of the broader Decade of Gas agenda, which seeks to expand domestic gas production, strengthen industrial growth, and improve overall energy security.

Government sources emphasise that the repayment will enhance electricity supply, stimulate industrial activity, and create economic opportunities as gas producers ramp up operations across the country.