The Federal Government has approved an increase in the price of natural gas supplied to power generation companies, raising it to $2.18 per metric million British thermal units (MMBTU), effective April 1, 2026.
The adjustment was announced by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which stated that the new rate reflects a $0.05 increase from the previous price of $2.13/MMBTU, as outlined in its latest circular.
According to the regulator, the updated Domestic Base Price (DBP) for gas in Nigeria has also been set at $2.18/MMBTU, serving as the minimum benchmark for gas transactions in the domestic market. In addition, commercial consumers will now pay $2.68/MMBTU, up from the former rate of $2.63/MMBTU.
For gas-dependent industries such as ammonia, urea, methanol, and low-sulfur diesel production, pricing will operate within a regulated band, with a floor of $0.90/MMBTU and a ceiling aligned with the new domestic base price of $2.18/MMBTU.
The price adjustment comes at a critical time for Nigeria’s power sector, which continues to grapple with persistent gas supply constraints. Power generation companies (GenCos) have repeatedly raised concerns over inadequate gas supply, attributing the challenge to mounting unpaid debts owed to gas suppliers.
The Association of Power Generation Companies recently disclosed that the Federal Government owes its members an estimated N6 trillion, a claim that has been contested by the Minister of Power.
Analysts warn that the latest increase in gas prices could further exacerbate existing challenges in the sector, potentially deepening the ongoing “gas constraint” issue and impacting electricity generation nationwide.
Comments