In Historic Move, FG Unveils Nigeria’s Gas Trading, Payment System

•Platform to ensure  transparent, competitive market

•Ribadu says illegal refining networks dismantled

•SEC describes event as monumental shift from physical market

Emmanuel Addeh in Abuja

In a landmark step aimed at modernising Nigeria’s gas industry, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) yesterday launched the country’s first Gas Trading Licence alongside a new Clearing House and Settlement System, an initiative expected to usher in a transparent, competitive and investment-ready gas market for Africa’s biggest energy producer.

Unveiled in Abuja, the platform marked the beginning of formal, regulated gas trading in Nigeria, shifting the sector from opaque bilateral deals to a structured market where prices, transactions and payments are visible, standardised and enforceable.

At the event, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, described the move as fully aligned with President Bola Tinubu’s energy-security agenda, adding that clear rules and trusted market participants would reduce risk, deepen liquidity and attract capital into the gas value chain.

Ekpo stated that the effort will pave the way for smooth natural gas business, transparent pricing, efficient price determination, and secure payment mechanisms,  hallmarks he said aligned seamlessly with national energy policies and global best practices.

The minister noted that the President’s vision requires a regulatory environment that is predictable, trusted, and designed to unlock value, explaining that the inauguration was a demonstration of that commitment.

“Our country is richly endowed with natural gas reserves, among the biggest in the world, but if the underlying market where the gas will flow is not efficient, reliable, and well-regulated, it will not be possible for us to realise the ultimate potential of the resource.

“The Gas Trading Licence introduced today is decisive on this front, paving the way for a new, regulated market where reliable traders will feel safe doing business, where businesses can plan, and where investors can invest, knowing that it will safeguard both their capital and the public interest”, Ekpo added.

According to Ekpo, the Gas Trading Licence is, therefore, the implementation of the provisions of the licensing requirement that make the investment possible, providing the governance framework essential for a modern gas industry.

Explaining the import of the license for the market, Ekpo listed them as: Access, dependability and affordability.

For its part, the NMDPRA, which issued the licences to JEX Markets Limited, said the step unlocked a key provision of the Petroleum Industry Act (PIA) and laid the foundation for Nigeria’s ambition to become a regional gas trading hub.

Authority Chief Executive (ACE), Farouk Ahmed, noted that with over 209 trillion cubic feet of proven reserves, Nigeria’s gas economy has long been constrained by pricing opacity, weak contract performance and low investment, issues he said the new regime seeks to correct through automated trading, transparent price discovery and enforceable settlement.

Ahmed stated that the latest development was in compliance with the provisions of section 159 of the PIA for the trading and settlement of wholesale gas in Nigeria.

He explained that Nigeria’s gas-focused strategic policies, initiatives and fiscal and regulatory frameworks such as the Decade of Gas (DoGas) Initiative, Presidential CNG initiative (PiCNG), Nigerian Gas flare Commercialisation Programme (NGFCP) and executive orders of  President Bola  Tinubu, on investment promotion and incentives have continued to position Nigerian’s gas sector as an attractive investment environment on the African continent.

The Gas Trading Licence and other relevant regulatory instruments administered by the NMDPRA, he said, have continued to promote the sustainable development of the gas markets through the application of global best practices.

According to him, this is to ensure transparency and efficiency; price discovery and reporting; safe and reliable market trading practices; automated online and real-time market trading; market liquidity and inclusive participation as well as enhanced market access.

As the regulator of Nigeria’s midstream and downstream petroleum sector, the Authority Chief Executive stated that NMDPRA recognises that the true test of licensing JEX markets is not in the ceremony, but in the transformation it must deliver.

“To ensure that JEX succeeds as Nigeria’s pioneering gas trading, clearing and settlement platform, we will provide a firm, transparent and technology enabled regulatory framework under the PIA, giving investors the certainty and confidence required to commit long term capital to the gas value chain.

“We will continue to work closely with our sister regulators, including the Securities and Exchange Commission (SEC) and key financial market institutions, harmonise market rules, standardise transaction contracts, and ensure that clearing and settlement arrangements meet the highest global standards,” he assured.

The National Security Adviser (NSA), Nuhu Ribadu, represented by his Special Adviser on Oil and Gas, Goodluck Ebelo, stressed that the success of the new trading architecture depends on a safe operating environment.

Ribadu stated that coordinated security operations have sharply reduced pipeline vandalism, illegal refining networks and crude theft, restoring confidence to producers and midstream operators. He pledged continued protection of existing and emerging gas corridors, including strategic pipelines critical to power supply, industrial expansion and regional exports.

He noted that the achievement represented much more than regulatory progress, but a decisive step in the federal government’s commitment to actualising the ‘Decade of Gas’ agenda and unlocking the full potential of Nigeria’s vast natural gas resources.

A robust gas economy, especially one anchored on over 200 TCF of reserves, he stressed, can only thrive within a secure and stable operating environment, positing that in the past two years, under the leadership of Tinubu, the federal government has made unprecedented progress in securing oil and gas infrastructure nationwide.

“Through the NSA-led Joint Coordination Platform, the military, police, DSS, NSCDC, NNPC Ltd, NMDPRA, NUPRC, and state governments now operate under a unified, intelligence-driven structure. This has enhanced response time, strengthened operational synergy, and eliminated duplication of efforts.

“We have also deepened engagement with traditional rulers, local leaders, and youth groups—transforming host communities into partners in protecting national energy assets. We also brokered peace on the direct supervision of Mr President in Ogoni land . Efforts are ongoing to conclude negotiations and bring those assets into production for the benefit of the people and country.

“These efforts have yielded measurable gains: Major pipeline breaches have declined significantly; illegal refining networks have been dismantled; notorious oil theft syndicates have been arrested and prosecuted and pipeline integrity and operational consistency have improved,” the NSA pointed out.

The impact, he said, is visible across the industry, with crude oil production rising, shut-in volumes being restored, gas gathering and transmission facing fewer disruptions, and investment confidence rebounding.

“More gas is flowing to power plants, industries, and export systems, contributing to increased national revenue and greater economic stability.As we secure existing infrastructure, the NSA’s office is also prioritising the protection of new and strategic gas pipeline systems vital to Nigeria’s industrial expansion and regional energy leadership,” Ribadu added.

The Securities and Exchange Commission (SEC), which also authorised the Clearing House, described the initiative as a major shift from the physical handling of gas to its emergence as a fully tradable financial asset.

Director General, Emomotimi Agama, said the new framework will create a credible Nigeria Gas Price Index, enable market-making, de-risk infrastructure investment and broaden Nigeria’s capital market with a new asset class.

He urged producers, off-takers and financiers to participate actively, arguing that a deep, transparent market will anchor industrialisation, strengthen energy security and support long-term economic diversification.

The theme: “Gas Trading on Recognised Platform and Economic Diversification,” he said, cuts to the very heart of Nigeria’s national ambition, noting that it declares that the country’s vast hydrocarbon resources, particularly gas, will no longer be just a commodity for export or domestic use, but a financially traded asset on a transparent, efficient, and regulated market platform.

“In short, we are building not just a market, but a credible and resilient market infrastructure. This ‘regulatory readiness’ is what converts potential into lasting investment, “ he stated.