The Federal Government has disclosed that out of the $1.3 billion outstanding debts owed the Gas Suppliers in the country, it has paid over $120 million to offset part of the debts.
This is even as the Minister of State Petroleum (Gas), Rt. Hon. Ekperikpe Ekpo asserted that with over 208Tcf in proven Gas Reserves, Nigeria has no business with Energy Poverty.
Hon. Ekpo who was on his way to Algeria to attend the 7th Summit of Heads of State and Government of the Gas Exporting Countries Forum at the instance of President Bola Tinubu made a brief stopover at the ongoing 7th Edition of the Nigeria International Energy Summit (NIES) to deliver his address on Thursday, in Abuja.
He called on all the critical stakeholders in the oil and gas sector in the country to assist the government in its quest to reposition the sector and the country for the economic prosperity of future generations.
Speaking on the government’s efforts in resolving the issues of gas-to-power, the Director, Decade of Gas Secretariat, Mr. Ed. Ubong informed that the arrears gas producers are owned as at last year was about $1.3 billion, however, “between October and the end of January, the government paid over $120 million to offset some of that money”.
More importantly, he said, “the government is also now working a framework that can mitigate most of that failure. That’s a piece of work that is ongoing and we hope that it will be approved and then the industry can move away from that legacy issue.
“We must build a gas capacity. The engineers, the technicians that will work in this new gas sector that we are looking at for the next eight months.
“And at the Secretariat, we are committed to that. We are looking for interns, we are looking for young people who are willing to join us and then provide their time and energy supporting the wider and bigger goals of the sector”, he said.
The Former President of the Nigerian Gas Association disclosed that for the first time, a Ministerial Committee was set up involving the Minister of State for Petroleum (Gas) and the Minister of Power to assess and address the issues, expressing confidence that “when that becomes fully operational, that critical link between gas and power will lead to more sustainable solutions going forward”.
Recently, the Minister of Power, Chief Adebayo Adelabu disclosed that the federal government was working to settle the existing sectoral outstanding debt obligations to the Gas Suppliers and Power Generation companies using partly cash payment and guaranteed debt instruments.
He explained: “today, we are owing a total of N1.3 trillion to the power generating companies, out of which 60 per cent is owed to gas suppliers. Today we have a legacy debt to the gas companies of $1.3 billion; at today’s rate, that is close to N2 trillion.
“Now, if you add N2 trillion legacy debt owed to gas companies and the N1.3 trillion being owed to GenCos, we have an inherited debt of over N3 trillion in this sector”, Chief Adelabu said.
Recall, in January 2024, the Transmission Company of Nigeria (TCN) blamed the low power generation and distribution in the country on gas constraints.
TCN explained that the gas constraints to the thermal generating companies impacted the quantum of bulk power available on the transmission grid for onward transmission to the distribution load centers nationwide.
For over 40 years, the country’s capacity to generate and successfully transmit electricity has hovered around 4,000 and 5,000 megawatts, even after spending over $ 12 billion in the sector.
This, the Nigerian government blamed on a lack of sustaining liquidity and infrastructure funding, as well as structural misalignment.
