Nigeria Awards 25-Year Gas Licences to Boost Domestic Supply
Nigeria has taken a major step towards transforming its domestic gas market, issuing 25-year gas distribution licences to 10 companies in a bid to accelerate last-mile gas supply to homes and industries across the country. The move, overseen by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), is part of the federal government’s broader drive to deepen gas utilisation and expand energy access.
The licences, covering key industrial hubs in Lagos, Ibadan, Port Harcourt, and Benin City, are expected to unlock over 1.5 billion cubic feet of gas per day through a 1,200km pipeline network and more than 500 customer stations.
Announcing the initiative in Abuja on Tuesday, NMDPRA’s Chief Executive, Ahmed Farouk, said the 10 successful recipients—including the Nigerian National Petroleum Company (NNPC), Shell, Nipco, and Axxela—were selected from 30 applicants following rigorous screening. The awarded franchise areas are all linked to the Escravos-Lagos Pipeline System, ensuring a steady supply of natural gas.
Among the key zones, the Greater Lagos Industrial Area will be managed by NNPC and Gaslink with a capacity of 130 million standard cubic feet per day (MMSCF/D), while the Lekki Free Trade Zone, operated by NNPC and Nipco, will handle 25 MMSCF/D. In the South-South region, Port Harcourt’s two local gas distribution zones, overseen by Shell and Central Horizon Gas Company, will have a combined capacity of 80 MMSCF/D.
Farouk emphasised that the licensing regime would serve as a catalyst for economic growth, industrial development, and Nigeria’s ongoing energy transition.
“This initiative supports the expansion of gas supply to energy-intensive industries, industrial parks, economic zones, and embedded power generation,” he stated. “It will not only accelerate the domestic gas market but also create profitable investment opportunities for stakeholders.”
The announcement comes as Nigeria intensifies efforts to position gas as the linchpin of its energy strategy. Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, reinforced the government’s commitment to fully implementing the Petroleum Industry Act (PIA) and ensuring that gas distribution remains efficient and non-discriminatory.
“The issuance of these licences marks a pivotal moment,” Ekpo said. “Gas is critical to our energy transition and economic transformation. This programme will bring cleaner energy closer to Nigerians and reduce reliance on traditional, carbon-intensive fuels.”
NNPC’s Group Chief Executive Officer, Mele Kyari, also revealed that the company and its partners are investing $500 million to construct five liquefied natural gas plants in Ajaokuta, Kogi State, as part of efforts to boost gas distribution.
With demand for natural gas growing and Nigeria seeking to harness its vast reserves, the newly issued licences signal the government’s ambition to create a more robust, sustainable, and investor-friendly gas sector. As regulatory frameworks continue to evolve, industry players will be watching closely to see how these ambitious plans translate into tangible results.
