Darkness looms as NMDPRA Ceases Gas Provision to GenCos

Gas producers have been ordered by the Nigerian Midstream and Downstream Petroleum Regulatory Authority to stop supplying gas to indebted generation firms (GenCos), which will result in an impending blackout of power.

The Authority said that producers’ capacity to continue operations had been hampered by the huge debts they owed.

It urged gas suppliers to make sure that the gas delivered is paid for on time, especially power-producing businesses.

There are presently about N2 trillion in legacy debts owed to Nigerian gas producers by the federal government and some GenCos.

Farouk Ahmed, the Authority’s chief executive officer, made the announcement while attending a stakeholder sensitisation session on wholesale supply operations in Nigeria.

According to Ahmed, who was accompanied by the agency’s legal counsel Joseph Tolorunse, gas producers were told to stop supplying gas receiver firms with gas since they were not paying for the gas that was given.

Oando’s Emmanuel Cofie-Spiff brought attention to the problem by stating that just 28% of the petrol that was supplied to off-takers had actually been received.

He said that the Authority had not sufficiently backed producers’ claims for payment and that this had contributed to the company’s significant financial burden.

Ahmed, however, rejected this allegation, claiming that the Authority ordered the impacted businesses to cease gas service until payment was obtained after receiving complaints.

The regulator and stakeholders also couldn’t agree on who should be in charge of collecting the 0.5% tax on petrol that is supplied on behalf of the federal government during the event.