Nigeria authorizes a $128 million gas debt settlement in an effort to increase electricity supplies

Nigeria has authorized the disbursement of 185 billion naira ($128 million) to settle longstanding debts owed to gas producers for their supplies to power generators, with the goal of rebuilding trust in the energy market and enhancing electricity supply.

The National Economic Council, led by the vice president, endorsed the decision after President Bola Tinubu’s instruction to address arrears that have hindered investments, strained cash flows, and limited gas supply for power generation, according to the minister of state for petroleum.

Ekperikpe Ekpo stated that the settlement, which will be executed through a “royalty-offset arrangement,” represents a “decisive step” in revitalizing Nigeria’s gas sector and stabilizing electricity production. He noted that this initiative is in line with the government’s goal to nearly double gas output to 12 billion cubic feet per day by 2030.

Nigeria, the most populous country in Africa, continues to grapple with ongoing electricity shortages that have impeded business operations and economic growth for decades.