Nigeria has approved a 185-billion-naira payment to gas producers to settle longstanding debts and rebuild confidence in its troubled energy market.
The National Economic Council endorsed the payout after President Bola Tinubu ordered the clearance of arrears that have strained cash flows and discouraged vital investment.
Petroleum minister of state Ekperikpe Ekpo said the settlement would be executed through a “royalty-offset arrangement” designed to ease pressure on suppliers and revive stalled gas deliveries to power plants.
He described the move as a decisive intervention aimed at stabilising electricity output and restoring momentum in a sector critical to Nigeria’s economic ambitions.
The initiative also supports the government’s plan to nearly double daily gas production to 12 billion cubic feet by 2030, marking a strategic push to expand the country’s energy base.
Nigeria, Africa’s most populous nation, has endured chronic power shortages for decades, leaving businesses constrained and communities dependent on costly generators.
Officials hope the cleared debts will help unlock new investment, improve supply reliability, and signal a firmer commitment to long-delayed energy reforms.
The payment, equivalent to about $128 million, forms part of broader efforts to rebuild trust between government and industry in a market long defined by uncertainty.
($1 = 1,447.3300 naira)