FG reduces price of gas to power from $2.50 to $2.18

FG reduces price of gas

The Federal Government has announced the reduction of the price of industry power gas from $2.50 to $2.18 with immediate effect.

This follows the successful negotiation between the Federal Government and organized labor in addition to the detailed review of the gas pricing framework in Nigeria.

This disclosure was made by the Minister of State for Petroleum, Mr. Timipre Sylva, who represented President Muhammadu Buhari at the 2021 Gas Sector Stakeholders (Ajaokuta-Kaduna-Kano, AKK Gas Pipeline Project) Forum held in Kano.

While declaring open the event, Sylva said that the government has already agreed to sell Industry Power Gas at the approved price of $2.18 instead of $2.50 which he said has been communicated to the relevant stakeholders for compliance.
What the Minister of State of Petroleum said on behalf of the President
Sylva said the change in price was to allow a quick industrial desired revolution embarked upon by President Muhammadu Buhari’s administration.

He said, “Following the successful negotiation between the Federal Government and the organized labor unions and the detailed review of the gas pricing framework in Nigeria, the price of gas to power has been reduced from $2.50 to $2.18 with immediate effect.

The outcome of the negotiation and reviews have been communicated to relevant stakeholders.’’

He pointed out that the President said the completion of the project would help in revitalizing the industries and create more jobs opportunities in the benefitting states which include Kano, Kaduna, and Nasarawa states.
He said, “The project is the focus of facilitating increased gas penetration in the Northern part of the country, especially the AKK pipeline corridor of FCT, Kano, Kaduna, Kogi, Niger, Nassarawa, and other neighboring states.

“Therefore the forum is geared towards sensitizing the entire northern parts of Nigeria of the upcoming opportunities to bring both new and hitherto moribund companies back to life.

“Kano State alone is dotted with several industrial parks. These and others in other states justify the need to optimize value creation from these industries.
Experts estimate that it will take at least two to three years to rehabilitate and position these industries for optimal performance. Thus, today’s collaboration with all stakeholders is geared towards kick-starting the required activities that will guarantee full usage of the delivered gas through the AKK pipeline when completed.
Today’s event reinforces our commitment to realizing the inherent potentials of Gas usage as the National Catalyst for Achieving Economic Diversification from Crude oil and transition fuel from fossil fuels of today to the renewable energy of tomorrow.

“It is this commitment that informed our support and commission of two gas-powered plants, vessel pipeline operated in Kano State in December 2020 in achieving the uninterrupted delivery of over 30 megawatts of power supply to the industrial hubs.

“Our successful collaboration and the completion of the AKK in 2023 will significantly enhance Mr. President’s vision and current drive for increase domestic gas utilization as the mainstay for national industrialization, increase foreign investment, government revenue growth, and ultimately provide more job opportunities for Nigerians.’’

On his part, the Group Managing Director of Nigeria National Petroleum Corporation, NNPC, Mr. Mele Kolo Kyari, said they were working assiduously in ensuring the timely completion of the project.

Kyari said that some of the equipment has already been delivered to Nigeria from abroad adding that the AKK project when completed will provide about 1 million jobs.

What you should know
It can be recalled that in June 2020, President Muhammadu Buhari flagged off the construction of the $2.8 billion 614km Ajaokuta-Kaduna-Kano (AKK) natural gas pipeline, the single biggest gas pipeline project in Nigeria’s history, in Ajaokuta (Kogi State) and Rigachikun (Kaduna State).

The project, which took off after months of discussions in and out of the country, is expected to carry gas between the southern and northern parts of the country and will eventually extend to North Africa.

The Federal Government had last month said that it is targeting the Trans-Saharan and European markets with the ongoing construction of the AKK Gas Pipeline project.

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