Gas-producing companies in Nigeria have renewed calls for the Federal Government to urgently address the N2.7 trillion legacy debt owed to them for gas supplied to electricity generation companies (GenCos). The plea was made under the umbrella of the Independent Petroleum Producers Group (IPPG) during a high-level meeting with the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, in Abuja on Tuesday.
The delegation, led by IPPG Chairman Abdulrazaq Isa, expressed deep concern over the growing debt and its negative impact on upstream investments and the stability of gas supply to the power sector.
In a statement issued by the minister’s media aide, Louis Ibah, the group urged the government to provide quick intervention in key areas like gas pricing, gas flare penalties, infrastructure, receivables, and LPG availability to prevent further disruption in the sector.
The gas producers noted that despite the Federal Government’s earlier commitment to offset the backlog gradually, there had been little to no movement, leaving them in financial distress. As of December 2024, the N2.7 trillion debt burden remains unpaid, forcing some companies to suspend gas supply to GenCos, resulting in nationwide blackouts earlier in the year.
Isa said the debt and other unresolved industry challenges were crippling producers’ ability to continue supplying gas, invest in new projects, or maintain existing infrastructure. “We need urgent policy and financial support if we are to maintain operations and attract new investment,” he stated.
The chairman, however, commended President Bola Tinubu for appointing indigenous oil and gas experts into critical leadership positions in the Nigerian National Petroleum Company Limited (NNPC Ltd) and the Organisation of the Petroleum Exporting Countries (OPEC). He also praised Minister Ekpo for his commitment to transforming the gas sector.
In his response, Ekpo acknowledged the essential role of IPPG members in Nigeria’s gas value chain, noting that their contributions support jobs, economic growth, and President Tinubu’s Renewed Hope agenda. He assured the producers that the Federal Government is aware of their challenges and is working toward a resolution, including engaging relevant stakeholders and regulatory agencies.
“We recognise your challenges and will collaborate to address them. The gas sector is critical to the country’s energy transition and economic diversification goals,” the minister said.
The IPPG is a group of indigenous Nigerian exploration and production companies playing a strategic role in the country’s oil and gas sector. The group has consistently advocated for improved policies, transparency, and financial stability in the industry.
Industry observers say unless the debt issue is resolved promptly, the country risks further disruption in power supply and could see a sharp decline in investment in the gas sub-sector, threatening progress toward energy sufficiency and industrialisation.
