The Director, Decade of Gas Secretariat at Nigeria International Energy Summit (NIES), Ed Ubong while speaking at the 2024 edition of NIES in Abuja, said that the federal government has paid over $120 million to offset some of the debts owed to the gas companies (GenCos)
“The arrears producers are owed as of last year was about $1.3 billion. But I am pleased that between October 2023 and the end of January 2024, the government has paid over $120 million to offset some of that debt,” Ubong said.
More importantly, he stated that the government is now working on a framework that can liquidate most of the debts.
“That’s the piece of work that is ongoing and we hope that it will be approved and the industry can move away from legacy issues,” he added.
He called out to stakeholders in the oil and gas sector to collaborate with the government to achieve economic stability and to meet global demand.
“Sitting at the back of the earth is about 300 million to 600 million scuff of gas which can become available once the OB3 gas pipeline is completed.
“Once OB3 is completed, over 600 million scuffs of gas will become available on the network feeding into the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline.
“We must build a capacity for gas. The engineers, the technicians that will work in this new gas sector that we are looking at for the next eight months,” he said.
He further informed the public that the Decade of Gas Secretariat is looking for hardworking youths and competent professionals who are willing to join and support them in achieving the sector’s goal.
Also speaking at the summit, Akachukwu Nwokedi, president of the Nigerian Gas Association (NGA) stated that the Federal Government should adopt preventive measures to abstain from debts in the future.
“We therefore recognize that there have been steps to clear the debts and I am happy to hear that over $120 million have already been cleared.
“But for us, it is not just about clearing the debts, which is a very good thing, but it is putting in place the right policies and mechanisms that will prevent reoccurrence”
“These have to stop and the approach needs to be harmonized and streamlined to enable businesses and encourage investment.
“We can also learn from countries like Australia and others that are very deliberate in implementing friendly policies. We need policies that will enhance Foreign Direct Investment in the gas space,” Nwokedi said.
He further advised that there should be multiplicity of taxes or levies in existing policy regulations and also increase in the cost of doing business “which chips away all the returns and discourages new and existing players”
