Federal Government Raises Gas Price for Power Companies

The federal government has increased the price of natural gas supplied to electricity generation companies, raising the cost to $2.18 per metric million British thermal units (MMBTU) from April 1, 2026.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA, announced the new price in a circular issued on Tuesday. The new rate is $0.05 higher than the previous price of $2.13 per MMBTU.

The regulator also said the updated Domestic Base Price for the local market has now been fixed at $2.18 per MMBTU, making it the new minimum price for gas sold within Nigeria.

Commercial users will also pay more under the new pricing structure. Their gas price has been raised to $2.68 per MMBTU, up from $2.63 per MMBTU.

For gas-based industries such as ammonia, urea, methanol, and low-sulfur diesel producers, the approved price range will remain within a band of $0.9 per MMBTU at the low end and $2.18 per MMBTU at the high end.

The increase is expected to put more pressure on Nigeria’s already struggling power sector, especially on generation companies that rely heavily on gas to produce electricity.

The new price comes at a time when power generation companies have continued to complain about gas supply problems linked to unpaid supplier debts. Industry operators have warned that the higher gas cost could worsen the challenges facing electricity generation in the country.

There is also ongoing disagreement over the scale of debts in the sector. While the Association of Power Generation Companies recently said the federal government owes GenCos about N6 trillion, the power ministry has challenged that claim.

With gas costs now rising again, concerns are growing that Nigeria’s electricity sector may face even more pressure in the months ahead.