The Federal Government, through the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), has awarded 25-year gas distribution licenses to 10 companies as part of its efforts to expand domestic gas utilisation across Nigeria.

The licenses, granted during a ceremony in Abuja on Tuesday, cover franchise areas in Lagos, Ibadan, Port Harcourt, and Benin City, aiming to ensure a steady supply of natural gas to homes and industries across the southwestern and southern regions.

The Authority Chief Executive of NMDPRA, Ahmed Farouk, announced that the Nigerian National Petroleum Company Limited (NNPC), Shell, Nipco, Central Horizon Gas Company, Falcon, and Axxela were among the recipients. The companies will operate gas distribution networks in areas already connected to the Escravos-Lagos Pipeline System.

Key Gas Distribution Zones and Operators

From the 30 applications received, only 10 companies met the eligibility criteria to spearhead the first phase of Nigeria’s gas expansion initiative. The awarded zones and their operators include:

• Agrara, Ota, and Badagry Local Gas Distribution Zone – NNPC and Shell (102 million standard cubic feet per day, MMSCF/D)

• Greater Lagos Industrial Area (GLIAS Local Gas Distribution Zone) – NNPC and Gaslink (130 MMSCF/D)

• Ikorodu Local Gas Distribution Zone – NNPC and Falcon (25 MMSCF/D)

• Kara Bridge-Ibafo-Sagamu Interchange Local Gas Distribution Zone – NNPC and Nipco (150 MMSCF/D)

• Lekki Free Trade Zone Local Gas Distribution Zone – NNPC and Nipco (25 MMSCF/D)

• Ogere-Ibadan-Oluyole-Olorisako-Asuire-Ajoda Local Gas Distribution Zone – NNPC and Nipco (150 MMSCF/D)

• Port Harcourt Cluster 2 Local Gas Distribution Zone – Central Horizon Gas Company (50 MMSCF/D)

• Port Harcourt Cluster 1 Local Gas Distribution Zone – Shell (30 MMSCF/D)

• Ada Local Gas Distribution Zone – NNPC (30 MMSCF/D)

• Benin Local Gas Distribution Zone – Nipco (20 MMSCF/D)

Gas Distribution Expansion and Economic Impact

Farouk emphasized that the licenses would enable the distribution of over 1.5 billion cubic feet of gas per day through a 1,200 km gas pipeline network and more than 500 customer stations.

“This initiative will support the development of our domestic gas market by ensuring gas supply to industries, special economic zones, embedded power generation, and compressed natural gas (CNG) mobility schemes,” Farouk said.

He highlighted that the new licensing regime would attract investments, create employment opportunities, and accelerate Nigeria’s energy transition.

FG’s Commitment to Gas Infrastructure Development

The Minister of State for Petroleum Resources (Gas), Hon. Ekperikpe Ekpo, reiterated the government’s commitment to expanding gas supply across Nigeria. He noted that the initiative aligns with the Gas Distribution Regulations of 2023 and will ensure non-discriminatory gas distribution.

Ekpo also pointed out the critical role of gas in addressing environmental concerns, stating that 600,000 women and children die annually in Africa due to exposure to carbon monoxide from unclean cooking fuels. He emphasized that 1.2 billion women in Africa lack access to clean cooking and that expanding gas distribution could significantly reduce these health risks.

NNPC’s $500 Million Investment in Gas Projects

Meanwhile, the Group Chief Executive Officer of NNPC Limited, Mele Kyari, revealed that NNPC and its partners are investing $500 million to construct five new liquefied natural gas (LNG) plants in Ajaokuta, Kogi State. This is part of NNPC’s broader efforts to enhance gas supply and infrastructure in Nigeria.

Kyari assured license holders of an adequate gas supply across the franchise zones and urged industry stakeholders to support the federal government’s gas expansion plans.

Regulatory Support and Future Plans

Farouk further stated that the NMDPRA is reviewing the Gas Transportation Network Code to improve operational efficiency, pressure stability, and gas metering accuracy. Additionally, the authority will periodically revise gas pricing and tariff frameworks to ensure affordability and competitiveness.

The government also plans to strengthen public-private partnerships to accelerate gas infrastructure development, ensuring Nigeria maximizes its vast gas reserves for economic growth and industrialization.

With this licensing regime, Nigeria is poised to advance its domestic gas market, create new revenue streams, and enhance the socio-economic impact of its natural gas resources.