NMDPRA presents 10 licenses to gas distributors

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) on Tuesday presented Gas Distribution Licenses to 10 companies. Speaking at the Gas Distribution Licence (GDL) Award ceremony in Abuja, the authority’s Chief Executive, Engr Farouk Ahmed, recalled that the organisation received 30 applications for licenses from which it approved 10. He said the licences cover […]

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) on Tuesday presented Gas Distribution Licenses to 10 companies.

Speaking at the Gas Distribution Licence (GDL) Award ceremony in Abuja, the authority’s Chief Executive, Engr Farouk Ahmed, recalled that the organisation received 30 applications for licenses from which it approved 10.

He said the licences cover about 1.5 billion standard cubic feet/day with over 1,200 kilometer of gas distribution pipeline network.

He added that the licenses issued cover over 500 customers.

Ahmed said, “Ten licences are being issued today as part of Phase-1 of the Gas Distribution Licensing regime to operators who have invested significantly in developing gas distribution infrastructures in the designated gas distribution zones and have met the prescribed minimum requirements.

“A cumulative gas distribution capacity of approximately 1.5 bscf/d with over 1,200km of gas distribution pipeline network as well as over 500 customer stations are covered by the licences being issued today.”

He said the GDL as provided in sections 148-152 of the PIA 2021 is a licence that gives exclusive right to establish, construct and operate a gas distribution system in a designated local Gas Distribution Zone (GDZ) issued to qualified applicants to distribute gas at the ‘last mile’.

Ahmed said due diligence was conducted on the 30 applications in line with defined prerequisites.

He noted that the licences being issued would support the ‘last mile’ expansion, crucial in completing an efficient and interconnected gas network across the country

He explained that the GDL regime holds a significant opportunity of supporting the development of the nation’s domestic gas market through the supply of gas to the energy-intensive industries, industrial parks, special economic zones, embedded/captive power generation, mobility CNG schemes and any other downstream gas utilization programme.

He vowed that the NMDPRA would continue working assiduously in providing regulatory support to industry stakeholders and ensure that critical gas infrastructures are completed and commissioned.

Ahmed said they include the OB3 river crossing, the AKK and the gas processing facilities across the gas-producing provinces of the country.

He further revealed that the NMDPRA shall also periodically revise the gas pricing and tariffing frameworks to ensure that the cost of gas remains fair and competitive, in line with the provisions of the PIA.

Speaking earlier, the Executive Director, Distribution Systems, Storage and Retailing Infrastructure at the NMDPRA, Mr Ogbugo Ukoha, recalled that in 2024, NMDPRA issued 15,000 licenses to operators.

According to him, in 15 years’ time, there would be no use of gas cylinders and trucks in the country.

It was an indication that Nigeria would in 15 years convey gas through pipelines to the end-users.

“As the AKK pipeline is operationalised this year, it will open the country to greater opportunities,” he added.