During the ongoing Nigeria International Energy Summit (NIES 2024) in Abuja, Ed. Ubong, Director of the Decade of Gas Secretariat, revealed that the federal government has disbursed over $120 million to offset a portion of the debts owed to gas companies (GasCos) for electricity generation.
Ubong emphasized the government’s commitment to addressing systemic failures and mentioned ongoing efforts to develop a framework to mitigate such challenges.
The arrears owed to gas producers amounted to about $1.3 billion as of last year, with a significant portion being addressed through recent payments. This initiative follows earlier announcements by Adebayo Adelabu, Minister of Power, regarding plans to tackle the indebtedness of the power sector to both electricity-generating companies (GenCos) and GasCos.
Transmission Company data indicated a recent decline in power supply due to constraints in gas availability, impacting the transmission grid’s capacity. Ubong stressed the importance of building gas capacity and involving young professionals in the sector to support its growth.
Akachukwu Nwokedi, President of the Nigerian Gas Association, highlighted the significance of addressing legacy debts in boosting investor confidence and attracting investments. He underscored the need for policies aimed at fostering sector growth and urged regulations to enable businesses, particularly given the current economic climate.
Nwokedi also welcomed the progress made in clearing debts, noting that over $120 million had already been settled.
