Business News

FG to pay N130 billion as part of N1.3 trillion gas supply debt 

The Federal Government has announced plans to pay N130 billion to settle part of the N1.3 trillion gas supply debts in the Nigerian Electricity Supply Industry (NESI). 

This was disclosed by the Minister of Power, Mr. Adebayo Adelabu, during his address at the 2024 Eighth Africa Energy Marketplace held in Abuja on Thursday. 

The event, which focused on Nigeria’s sustainable energy future through policy, regulation, and investment, was a collaborative effort by the African Development Bank (AfDB), the Ministry of Power, and the United Kingdom Nigeria Infrastructure Advisory Facility (UKNIAF). 

According to Minister Adelabu, President Bola Tinubu has endorsed the proposal from the Minister of State for Petroleum Resources concerning gas, which is to clear the outstanding debts owed to gas suppliers by the power sector. He explained that the payments would be divided into two categories: the legacy debts and the current debts.  

Furthermore, the Minister explained that the Ministry has received presidential approval to proceed with payments, contingent upon the reconciliation of outstanding debts between the government and the power generating companies. 

Mr. Sanusi Garba, Chairman of the Nigerian Electricity Regulatory Commission (NERC), commented on the financial difficulties faced by the Electricity Distribution Companies (DisCos). He stated that their poor financial condition has hindered their ability to raise the necessary capital for investment. 

Garba further explained that the current challenges in the sector are the result of accumulated past inactions and missteps by those responsible for managing the sector at both the policy and operational levels.