The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has increased the price of natural gas supplied to power generation companies to $2.18 per metric million British thermal units (MMBTU), effective April 1, 2026.
The new rate represents a $0.05 increase from the previous price of $2.13/MMBTU, according to a circular issued by the regulator on Tuesday.
The authority also announced updated Domestic Base Price (DBP) and wholesale gas pricing for the domestic market, in line with provisions of the Petroleum Industry Act and prevailing market conditions.
Under the revised structure, the DBP serving as the minimum price for gas sales within Nigeria—has been set at $2.18/MMBTU.
Commercial users will now pay $2.68/MMBTU, up from $2.63/MMBTU.
Gas-based industries, including ammonia, urea, methanol, and low sulphur diesel producers, will operate within a price band ranging from a floor of $0.9/MMBTU to a ceiling of $2.18/MMBTU.
The NMDPRA stated that the pricing adjustment reflects a gradual upward movement in domestic gas prices, guided by regulatory principles aimed at balancing affordability with investment incentives.
According to the regulator, pricing must encourage upstream producers to supply adequate gas to the domestic market, while remaining competitive with prices in similar emerging economies and aligned with international benchmarks.
The development comes amid mounting financial challenges in Nigeria’s power sector.
Recently, Chief Executive Officer of the Association of Power Generation Companies, Joy Ogaji warned that gas suppliers could halt supply to thermal power plants over an estimated N3.3 trillion debt owed by generation companies.
Power generation companies, in turn, have said they are owed about N6.5 trillion by the Federal Government, further compounding liquidity constraints across the value chain.
Industry analysts say the latest gas price increase could add further pressure on electricity generation costs and potentially impact power supply stability if not carefully managed.
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The new pricing regime is also expected to affect industrial production, as manufacturers and energy-intensive sectors grapple with rising input costs alongside existing economic challenges.
The NMDPRA, however, maintained that the pricing framework is designed to ensure long-term sustainability of the gas market while supporting domestic supply and attracting investment into the sector.
