- Government begins N185 billion repayment to restore gas supply for power generation.
- Debt clearance expected to boost investor confidence and revive exploration activities.
Nigeria has taken a decisive step to address long-standing challenges in the energy sector, as the Federal Government launches the Nigeria gas legacy debt repayment. The move aims to restore confidence among gas producers and improve supply to power plants. Consequently, the intervention marks a major turning point for electricity generation.
The National Economic Council, chaired by Vice President Kashim Shettima, approved the settlement of N185 billion in outstanding debts owed to natural gas producers. These debts have persisted for years, weakened cash flow, and discouraged investment. They also reduced gas supply to power stations, which worsened electricity shortages nationwide.
The payment will be made through a royalty-offset process designed to calm market concerns. Therefore, the initiative is expected to reassure both domestic and international suppliers who have long complained about delayed payments. The Minister of State for Petroleum Resources (Gas), Dr Ekperikpe Ekpo, described the approval as a bold effort to revitalise the gas sector.
He praised President Bola Tinubu’s commitment to the Decade of Gas initiative, which targets more than 12 billion cubic feet per day of gas supply by 2030. He explained that clearing the arrears will help restore investor trust and encourage new investments across the value chain.
According to Ekpo, financial stability will stimulate exploration and production, increase gas output, and support power generation. These improvements will ease electricity shortages that continue to limit economic growth. He added that reliable energy remains vital for industrial expansion, job creation, and overall competitiveness.
In a statement from his spokesman, Louis Ibah, the minister said that enhanced transparency and fiscal discipline will attract both local and foreign investors. He emphasised that improved confidence could unlock stalled projects and speed up ongoing developments.
Coordinating Director of the Decade of Gas Secretariat, Ed Ubong, also welcomed the approval. He stated that the Nigeria gas legacy debt repayment demonstrates the government’s determination to strengthen the entire value chain. He stressed that honoring gas-to-power obligations will push Nigeria towards a gas-driven economy and revive momentum behind strategic energy reforms.