The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has increased the natural gas price for power generation companies (GenCos) to $2.18 per million metric British thermal units (MMBTU). The adjustment, effective from Tuesday, reflects a $0.05/MMBTU rise from the previous rate of $2.13 per MMBTU. The decision was communicated in a circular issued by the regulator, which cited updated domestic base pricing calculations as the basis for the change. This marks the second price adjustment within the year, following earlier revisions linked to fluctuations in supply costs and exchange rates. The NMDPRA maintains oversight of fuel pricing for power plants under Nigeria's regulated energy market framework.
Raising gas prices for GenCos while tariffs remain under government control shifts more financial strain onto already struggling power firms. With the NMDPRA approving a $2.18/MMBTU rate, GenCos must now absorb higher input costs without corresponding tariff increases. This move makes cost-reflective pricing in the power sector even less likely in the short term.
