The Nigerian government has put an end to its monopoly on gas aggregation, paving the way for private investors to actively participate in the midstream sector. Historically, the private sector’s involvement in the gas industry was limited to the upstream and downstream segments. However, the Petroleum Industry Act (PIA) introduced the midstream sector, opening up new opportunities.
The Gas Aggregation Company Nigeria Limited (GACN) previously dominated the midstream sector, having been established by the Federal Government in 2010 following the National Domestic Gas Supply and Pricing Regulations.
In a significant development, the Nigeria Midstream Downstream Regulatory Authority has granted the first Wholesale Gas Supply License for 500 million standard cubic feet of gas per day to Ohuru Trading Limited, an indigenous company. Farouk Ahmed, the Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, announced this milestone.
The government’s decision to allow private sector participation aligns with its commitment to attracting foreign direct investments and other capital inflows into the domestic economy, with the ultimate goal of improving the living conditions of Nigerians. Ohuru Trading Limited, which primarily focuses on supplying gas to power plants, may initially utilize the existing gas transport infrastructure in the country to invest in such projects. This development signifies a positive step towards diversifying and expanding Nigeria’s gas sector.
