The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has announced plans to launch a digital licensing round for gas distribution areas across Nigeria before the end of 2026. This move is part of efforts to transform the country's natural gas sector. NMDPRA Chief Executive, Rabiu Umar, made this disclosure at the Gas Investment Forum 2026. The forum's theme was 'Positioning Nigeria as Africa’s Global Gas Powerhouse'. Umar emphasized the need for Nigeria to convert its vast gas reserves into usable infrastructure.
The licensing round will follow a nationwide gas distribution gridding exercise set to be completed in October. Investors will then bid for licences covering the mapped-out areas. Umar explained that the process will be similar to how licensees apply for oil mining licences in the upstream sector. This exercise aims to move the gas sector from its current fragmented infrastructure and access system to an open-access regime. The goal is to ensure that gas reserves are converted into productive infrastructure.
Umar highlighted the importance of gas infrastructure in facilitating the movement of gas from wellheads to processing plants, power stations, industrial clusters, and homes. He stressed that without infrastructure, gas reserves remain untapped potential. The NMDPRA is accelerating licences and approvals for various gas projects, including processing plants, pipelines, and storage facilities. The Federal Government’s Decade of Gas Initiative was described as an engine of execution.
The NMDPRA is also exploring new initiatives, such as floating LNG, to deepen CNG and LNG penetration. Umar noted that the LNG market has evolved, with LNG no longer solely associated with Nigeria LNG Limited. The authority is working with other companies to develop different LNG products. Domestically, LNG is being used, and new developments are underway.
Umar emphasized that access to pipelines should not be restricted to a few players under the planned open-access regime. The NMDPRA is rebuilding the Nigerian Gas Transportation Network Code to establish clear rules for injecting and taking gas from pipelines. The regulator has signed a cooperation framework with the Federal Competition and Consumer Protection Commission to address anti-competitive practices.
The framework will tackle issues such as price fixing, market sharing, and discriminatory access while protecting investment. Umar identified credible contracts, transparent tariffs, and enforceable rules as key foundations for investment. Investors are concerned about payment, supply reliability, and pricing. The NMDPRA is developing conditions for a willing-buyer, willing-seller domestic gas market.
The transition to this new market will be assessed based on supply diversity, infrastructure access, and contract performance. Umar cautioned that the regulator must balance encouraging investment with ensuring gas affordability. The NMDPRA's role is to act as a referee, ensuring a fair and transparent market. The gas distribution licensing round is expected to attract investment and boost Nigeria's gas sector.
Key points
- The NMDPRA plans to launch a digital licensing round for gas distribution areas by year-end.
- The licensing round aims to transform Nigeria's gas sector into an open-access regime.
- The NMDPRA is working to balance investment encouragement with gas affordability.
