FG cuts gas-to-power price by 32cents, now $2.18 per mmbtu

BY Mary Ugbodaga


Timipre Sylva, minister of state for petroleum resources, says the federal government has approved the downward review of gas-to-power for domestic supply obligation (DSO) by 32 cents to $2.18/MMBtu with immediate effect.

Sylva, who represented President Muhammadu Buhari at the 2021 gas sector stakeholders forum in Kano on Thursday, said the slash in price followed successful negotiations between federal government and organised unions.

The forum was organised by the Gas Aggregation Company Nigeria (GACN) and the Nigerian National Petroleum Corporation (NNPC) for the Ajaokuta-Kaduna-Kano (AKK) pipeline project.

“Let me use this medium to announce to this gathering that following the successful negotiation between the federal government and the Organized Labour Unions, and the detailed review of the gas pricing framework in Nigeria, the price of gas-to-power has been reduced from $2.50/mmbtu to $2.18/mmbtu (domestic supply obligation – DSO) with immediate effect. The outcome of the negotiations and review have been communicated to the relevant stakeholders,” he said.


In March 2021, the decade of gas was announced to set the tone for industry development in the next 10 years.

Buhari said the AKK project will increase the federal government revenue and create more job opportunities for unemployed Nigerians.

Saleh Mamman, minister of power, said the sector uses more than 60 percent of the gas currently produced in the country to generate electricity.


Mamman, represented by Abba Aliyu, his special assistant on policy, explained that price reduction will assist the federal government’s goal of delivering sustainable power for the country.

In his remarks, Mele Kyari, group managing director of the Nigerian National Petroleum Corporation, said the AKK project would provide enough gas for both domestic and export purposes; and revive about 232 industries along the facility’s corridor.

The 614 km AKK gas pipeline project was flagged off in June 2020, it will originate from Ajaokuta terminal gas station (TGS) in Kogi state and pass through Niger, Abuja and Kaduna then terminate in Kano.

The project has the capacity to unlock 2.2 billion cubic feet of gas to the domestic market and support the addition of 3,600 megawatts of power to the national grid.


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