The Nigerian government has approved the payment of ₦185 billion to settle outstanding debts owed to gas producers, in a move expected to ease the country’s chronic electricity shortages.
The approval, announced on Thursday, is part of a broader energy reform effort aimed at stabilising gas supply to thermal power plants — which generate more than 70 percent of Nigeria’s electricity.
The debt settlement is expected to encourage gas companies to ramp up production, restore supply obligations, and reduce frequent shutdowns of gas-dependent power stations.
According to officials, the payment will help unlock over 2,000 megawatts of stranded power currently unavailable due to inadequate gas feedstock.
Nigeria has for years struggled with inconsistent electricity output due to gas shortages, aging infrastructure, vandalism, and liquidity problems in the power sector.
Experts say settling the debt is a critical step but warn that long-term stability will require tariff reforms, improved transmission infrastructure, and strict accountability among operators.
Businesses and households remain hopeful that the intervention will provide some relief to a power sector widely regarded as one of the biggest bottlenecks to Nigeria’s economic growth.
