NMDPRA Expands Gas Supply Access to Power, Fertiliser Plants with New Network Code

*Targets 9 fuel laboratories nationwide by H1 2027

*Authority, NNPC advance talks to pilot national strategic fuel reserve

Peter Uzoho

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA)! has expanded gas supply access to power plants, fertiliser plants and shippers with the launch of Revision II of the Nigerian Gas Transportation Network Code (NGTNC).

Authority Chief Executive of NMDPRA, Mallam Rabiu Umar announced the new code Monday at the opening of the 20th Oil Trading and Logistics (OTL) Africa Downstream Week in Lagos after signing the document with key partners.

The partners comprise power generation plants, fertiliser plants, shippers and investors.

Umar said the new code will deepen domestic gas utilization and ensure open, fair access to gas transportation infrastructure.

“The Network Code basically is the rulebook for gas transportation. As we know, there’s one pipeline that different producers put their gas into. And for there to be equity, there needs to be a code, or if you like, rules of engagement on how you put your gas inside, how the gas is measured, and how you nominate gas.

“The pipelines deliver their full value only when access to them is open and fair. It is therefore a pleasure to announce, as you have witnessed, that the Authority has launched officially the revision 2 of the Nigerian Gas Transportation Network Code,” he said.

Speaking under the summit’s theme “Secure Energy, Shared Prosperity,” Umar said the code revision comes as gas demand rises, with about three-fifths of gas processed in September deployed to power plants, factories, NLNG and the West African Gas Pipeline (WAGP) while demand for cooking gas outstrips supply.

He said infrastructure to support the expansion is advancing, with the Oben-Obiafu-Obrikom (OB3) pipeline, the Escravos-Lagos Pipeline System (ELPS) midline compressor nearly complete and the Ajaokuta-Kaduna-Kano pipeline now more than 80 per cent built.

Once on stream, Umar said the gas pipelines would double national gas transport capacity from 2.2 to 4.4 billion cubic feet per day and linking southern supply to northern demand.

“Since revision 1, more shippers have come onto the network, and the imbalance on the Western network has fallen by about 30 per cent. Revision II builds on these gains, and I invite every shipper, transporter and investor to make full use of that,” Umar said.

He explained that the Revision II provides clearer rules for shippers and buyers, including provisions on shrinkage factor, noting that high shrinkage from wrong gas injection creates avoidable losses.

The code also lays the initial rules for regional pipelines, including the West African Gas Pipeline, the proposed Trans-Saharan Pipeline to Algeria and the Trans-African Pipeline to Morocco, requiring harmonised standards for cross-border gas movement.

On downstream security, Umar said a year ago more than half of petrol in Nigerian tanks was imported, but last month three in every four litres were refined domestically.

This he said, means energy security built at home as Nigerian crude refined in Nigeria is supplying Nigerians.

He however cautioned that much of current supply comes from one large refinery which ran above nameplate capacity in September, stressing the need for diversity through modular refineries, the four national refineries and competitive imports.

He said import licences will be issued only on published merit-based criteria and transparent shortfall determination.

On consumption trends, Umar said Liquefied Petroleum Gas (LPG) consumption has risen by almost half since 2021, while Compressed Natural Gas (CNG), which was almost non-existent six years ago, is expanding, with presidential directive to double penetration by year-end to enhance energy flexibility.

He disclosed that petrol stock cover stands at 24 days, below the 30-day threshold, while cooking gas is tighter, with diesel and aviation fuel comfortably above thresholds.

According to him, global guideline by the International Energy Agency (IEA) is 90 days, but Nigeria targets 30 to 45 days first.

“Over the past eight months, a war in the Gulf has shaken the world’s fuel supply and pushed crude oil to around $100 a barrel. Through it all, Nigeria kept its fuel flowing, because more of that fuel is now made here at home,” Umar said.

He revealed advanced talks with the Nigerian National Petroleum Company Limited (NNPC) to pilot the national strategic stock at the
Nigerian Pipelines and Storage Company Limited (NPSC) depots in Ibadan, Enugu and Suleja, to cushion the economy against price and supply shocks.

“Secure energy is energy we produce, we move, we store and price well for ourselves. Shared prosperity is what follows when the value of that energy stays and circulates within our economies and across our continent,” Umar said.

He also announced quality assurance expansion, with the first of nine fuel laboratories launched in Port Harcourt, two more by year-end and nine functional by mid-2027 in partnership with Bureau Veritas and Ace Energy and Power Solutions towards a National Reference Laboratory.

He said all Premium Motor Spirit (PMS) supplied in Nigeria was on-spec, with market data published monthly, and that NMDPRA does not set prices under the Petroleum Industry Act (PIA) but ensures fair competition.

With 215 trillion cubic feet proven gas reserves and 600 TCF prospective, Umar said Nigeria needs $30 to $50 billion fresh investment in processing, fertiliser, LPG and flare commercialisation.

He proposed an aligned fuel standards and a West Africa reference price to reduce dependence on European benchmarks like Amsterdam, Rotterdam, Antwerp (ARA) benchmarks.