NATIONAL GAS POLICY

What Is This Policy?

The National Gas Policy (NGP) is Nigeria's strategic framework to reposition the country as an attractive, gas-based industrial nation — transforming natural gas from an oil by-product into the primary driver of Nigeria's domestic industrial, power, agriculture, and transport sectors, while developing a significant international market presence.

Who Does It Target?

Upstream gas producers, midstream infrastructure operators, and downstream gas marketers and distributors Power generation companies dependent on gas feedstock Industrial, agricultural, commercial, and transportation sector gas consumers International and domestic investors in the gas sector Gas-dependent host communities in the Niger Delta and other gas-producing regions

What Does It Aim to Achieve?

Transform Nigeria from a crude oil export-based economy to a gas-based industrial economy Prioritise domestic gas supply to power the electricity sector, industry, agriculture, and transportation Establish a full separation of upstream, midstream, and downstream gas sectors with clear institutional mandates Develop a wholesale, market-led gas pricing framework replacing distortionary administered prices End routine gas flaring — Nigeria endorsed the World Bank's Zero Routine Flaring by 2030 initiative

Key Features

Sector Separation: Full legal separation of upstream gas production, midstream infrastructure ownership, and downstream gas marketing/trading Open Access Infrastructure: Prescribes open access to gas pipelines and infrastructure to promote competition and efficient utilisation Market-Led Pricing: Transitional pricing framework retained until sufficient supply volumes enable a mature wholesale gas market Gas-to-Power Priority: Power sector designated the priority domestic end-use sector, consuming over 70% of domestically produced gas Flare Gas Capture: Mandates flare capture utilisation projects and substantially raised flaring penalties; supports Nigeria Gas Flare Commercialisation Programme (NGFCP) Local Content & Capacity: Commits to developing domestic human and technical capacity to global export standards

Current Status

Rollout Stage: Active — key institutional reforms operationalised under PIA 2021 which established NUPRC, NMDPRA, and the Midstream & Downstream Gas Infrastructure Fund (MDGIF) Gas Reserves: Nigeria holds ~206.53 trillion standard cubic feet (tcf) of proven gas reserves — one of the largest in Africa Gas Flaring: Gas flared declined 45% from 9.6 to 5.3 billion cubic metres (2012–2022); 174 flare sites remain NGFCP: 49 flare sites awarded to 42 companies as of 2023 under the Gas Flare Commercialisation Programme Tax Incentives: Executive Order 2024 introduced Gas Tax Credits and Gas Utilisation Investment Allowance for greenfield gas projects Funding: MDGIF funded by 0.5% of wholesale petroleum/gas prices and gas flaring penalties

How to Access

Gas Producers: Obtain upstream licences under the PIA 2021 framework via NUPRC; domestic supply obligations are a licence condition Infrastructure Investors: Apply for midstream/downstream authorisations through NMDPRA; access MDGIF equity investments Flare Gas Investors: Apply for NGFCP allocations via the Ministry of Petroleum Resources Industrial Consumers: Engage gas marketers for domestic supply contracts; transitional prices set by Government until market matures Contact: Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA): nmdpra.gov.ng | Ministry of Petroleum Resources: petroleum.gov.ng

Important Terms

Domestic Supply Obligation: All upstream licence holders are required to supply gas to the domestic market as a condition of their licence Gas Pricing Transition: Domestic gas prices set during the transitional period; will migrate to market pricing once mature wholesale markets are established Flaring Penalty: Penalties for routine gas flaring are being substantially increased; routine flaring prohibited at all greenfield projects

Impact & Metrics

Nigeria's gas reserves (206.53 tcf) are three times its oil resources — the NGP seeks to monetise this underutilised wealth Power sector relies on gas for over 70% of electricity generation; gas feedstock shortages contribute to chronic power supply deficits Gas Flare Commercialisation Programme targets complete elimination of routine flaring at 174 remaining flare sites

Official Resources

Website: petroleum.gov.ng | nmdpra.gov.ng | nuprc.gov.ng Policy Document: National Gas Policy 2017 — available via Federal Ministry of Petroleum Resources Contact: Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Abuja Summary prepared using the Policy Summary Template | Source: NGP 2017, Banwo & Ighodalo, Templars Law, IEA, Centurion Law Group, PIA 2021 | February 2026

Legal Framework

The National Gas Policy operates under the Petroleum Industry Act 2021, which provides the legislative basis for upstream, midstream, and downstream gas sector governance. It aligns with the Associated Gas Re-Injection Act 1979, the National Energy Policy, the Electricity Act 2023 (gas-to-power component), and Nigeria's Paris Agreement NDCs on gas flaring. The ECOWAS Energy Protocol and the Gas Exporting Countries Forum (GECF) provide the international framework.