Minister of Power advocates legislation mandating natural gas payments in Naira
The Minister of Power, Adebayo Adelabu, proposed the implementation of legislative measures to mandate gas payments in the local currency, the naira, within the power sector.
Adelabu made this suggestion via his official social media account following a discussion with the Minister of State for Petroleum Resources (Gas), Ekperikpo Ekpe, regarding the ongoing shortage of gas supply to electricity generation companies nationwide.
The Minister emphasized that addressing the issue of insufficient gas supply to generation companies could be facilitated by ensuring payments for gas transactions are made locally.
He stated, “Proposing domestic gas payment in naira is a key step toward stability, aligning with our economy’s needs and promoting sustainable energy production. Payment shortfalls within the electricity sector pose risks to production and the entire value chain.”
“Leveraging my financial sector experience and contacts, I’m working with stakeholders to advocate for legislative measures mandating naira-denominated payments for domestic gas supply.”
The Minister also highlighted the issue of gas infrastructure vandalism as another challenge confronting the power sector, citing a 2021 NEITI report that documented approximately 7,143 incidents of pipeline breakages.
He harped on the implementation of clear contractual agreements between Generation Companies (GENCOs) and gas suppliers to guarantee a consistent gas supply to generation facilities moving forward.
Nigeria recently plunged into darkness following the collapse of the national power grid due to a shortage in gas supply to generation companies.
Minister of Power Bayo Adelabu also disclosed that two major electricity generation plants, Omotosho and Olorunsogo power stations, are operating at less than 25% capacity due to insufficient gas supply.
