Herein this post, the Federal Government says it has paid $120m out of the $1.3bn gas debt to companies for the supply of gas.
The Federal Government paid over $120 million to offset some of the gas debts owed to the companies for the supply of gas to run gas-fired power plants across the country.
The Minister of Power, Chief Adebayo Adelabu, recently revealed that the crash in power generation and attendant poor supply since January was because gas suppliers stopped supplying gas for the generation of electricity due to the indebtedness of the sector to gas producers.
Nigeria gets more than 70 per cent of its electricity from thermal power plants that run on gas. The remaining amount of electricity comes from hydropower-generating plants.
Speaking at the ongoing 7th Nigeria International Energy Summit in Abuja on Thursday, the Director, Decade of Gas Secretariat, Ed Ubong, expressed excitement that the Federal Government had cleared $120m out of the $1.3bn gas debts.
“As of last year, that gas debts was about $1.3bn, depending on how you add up the numbers. But I am pleased that between October and the end of January, the government has paid over $120m to offset some of that money,” Ubong said.
READ: Gas Commercialization/ Processing Plant in Nigeria
The Decade of Gas Secretariat is under the Federal Ministry of Petroleum Resources (Gas). The Federal Government is subsidizing electricity by paying for the gas used in generating power, as Nigerian power users are currently not paying the exact amount for electricity.
He said: “More importantly, the government is also now working on a framework that can mitigate most of that failure. That’s a piece of work that is ongoing and we hope that it will be approved and then the industry can move away from that legacy issue.
“We must build capacity for that. Capacity for the engineers, and technicians that will work in this new gas sector that we are looking at for the next eight months. And as the secretary, we are committed to that,” Ubong added.
“We are looking for interns, we are looking for young people who are willing to join us and then provide their time and energy supporting the wider and bigger goals of the sector.
“For the first time, we now have a ministerial committee. One that involves the Minister of State for Gas and the Ministry of Power, because power and gas, they go together.
“We are confident that when that becomes fully operational, that critical link between gas and power will lead to more sustainable solutions going forward,” Ubong stated.