Nigeria is advancing efforts to enhance domestic gas utilisation in line with the federal government’s clean energy initiative. As part of this push, the country is set to establish an efficient and interconnected gas network by issuing Gas Distribution Licences (GDLs) to qualified companies for last-mile gas distribution.
The GDL, as outlined in Sections 148-152 of the Petroleum Industry Act (PIA) 2021, grants exclusive rights to establish, construct, and operate gas distribution systems within designated local Gas Distribution Zones (GDZs). Among the beneficiary companies are NNPC Gas Marketing Company, Shell Nigeria Gas Limited, NIPCO Plc, Central Horizon Gas Company, Falcon Corporation Ltd., and AXXELA.
At the award ceremony in Abuja, Mr. Farouk Ahmed, Authority Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), revealed that over 30 applications were received, with only ten companies meeting the stringent requirements to secure Phase One of the GDL regime.
Ahmed stated that the newly- issued licences would enable 1.5 billion standard cubic feet per day (bscf/d) of gas distribution capacity, supported by a 1,200km gas pipeline network and over 500 customer stations. He emphasised that this initiative would expand the domestic gas market, supplying energy-intensive industries, industrial parks, special economic zones, embedded power generation, and Compressed Natural Gas (CNG) mobility schemes.
He further highlighted the advantages of Piped Natural Gas (PNG), noting that it ensures a continuous supply, reduces costs, enhances safety, and eliminates storage challenges. He assured that the NMDPRA would oversee tariff regulations, safety standards, and operational efficiency for all licence holders.
Minister of state for petroleum resources (Gas), Mr. Ekperikpe Ekpo, reaffirmed the government’s commitment to fully implementing the PIA 2021 and the Gas Distribution Regulations 2023. He cited African Development Bank (AfDB) statistics, which indicated that 600,000 women and children die annually in Africa due to exposure to unsafe cooking fuels, while 1.2 billion women lack access to clean cooking alternatives.
Ekpo announced that President Bola Tinubu’s Liquefied Petroleum Gas (LPG) penetration program, launched in September 2024, aims to expand LPG access across Nigeria’s six geopolitical zones and 774 local government areas (LGAs). He noted that gas reticulation would replace gas cylinders, allowing for direct piped gas supply to homes and businesses. This initiative would also accelerate CNG adoption for transportation and spur investments in pipelines, storage, and other critical gas infrastructure.
Praising President Tinubu’s leadership, Ekpo stated that the issuance of GDLs marks a significant step in making affordable and sustainable energy available nationwide. He stressed that gas will play a vital role in driving industrialisation, economic growth, and improving living standards across Nigeria.
“This step is not just about meeting regulatory requirements; it is about building a future where gas serves as a foundation for economic growth, industrialisation, and improved quality of life for all Nigerians,” he concluded.
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