- The Chairman, Nigerian Electricity Regulatory Commission (NERC), Sam Amadi has said that the regulatory agency will consider endorsing contracts for natural-gas supply above the regulated rate between a “willing buyer and willing seller,” so as to ensure increased deliveries to the nation’s ailing power plants, Bloombergreports.
- Nigeria, which holds Africa’s largest gas reserves, raised the price of the fuel to power plants to $2.50 for 1,000 standard cubic feet last August from about 50 cents to help spur deliveries but gas producers have said that they may need more than that to guarantee supplies.
- The nation produces about 9 billion cubic feet of gas a day, of which half is exported as liquefied natural gas. One billion cubic feet is flared during oil production and another 1 billion is reinjected into oil wells to maintain pressure. Almost 2 billion goes to industries and power plants, where demand is forecast to more than double to 5 billion cubic feet a day in two years.
Any proposed gas deals from energy companies must be “prudent,” Amadi said. “The bottom line is that because the tariff in the electricity industry is regulated, the cost of gas will be regulated.”