The Nigerian Midstream and Downstream Petroleum Regulatory Authority plans to conduct a digital licensing round for gas distribution areas across Nigeria before the end of 2026, as the regulator moves to expand infrastructure and establish a more open-access domestic gas market.
NMDPRA Chief Executive, Rabiu Umar, disclosed this at the Gas Investment Forum 2026, saying the licensing round will follow the completion of a nationwide gas distribution gridding exercise expected in October. Investors will then bid for licences covering the areas mapped across the country.
“Under the licensing round, applicants will bid for gas distribution licences in the gridded areas available across the country, in the same way licensees apply for oil mining licences in the upstream sector,” Umar said.
Umar said the exercise is part of efforts to move Nigeria’s gas sector away from its fragmented infrastructure and access system towards a truly open-access regime. He stressed that gas reserves would remain untapped potential without the infrastructure required to move the commodity from wellheads to processing plants, pipelines, power stations, industrial clusters, transport corridors, homes and export terminals.
The NMDPRA chief said the Federal Government’s Decade of Gas Initiative is serving as an engine of execution, with the regulator accelerating licences and approvals for gas processing plants, pipelines, storage facilities, compressed natural gas and liquefied natural gas projects. He also welcomed growing interest in floating LNG as Nigeria expands CNG and LNG penetration.
Umar said the regulator is rebuilding the Nigerian Gas Transportation Network Code to establish clear and consistently applied rules for injecting gas into pipelines and taking it out, including provisions on shrinkage factors. He added that companies with viable projects should be able to connect to existing pipelines, with the NMDPRA responsible for ensuring access under the law.
The authority has also signed a cooperation framework with the Federal Competition and Consumer Protection Commission to address anti-competitive practices in the gas sector. The framework will cover issues including price fixing, market sharing, abuse of dominance, capacity hoarding and discriminatory access, although infrastructure owners will not be required to surrender capacity that is already fully utilised.
Umar identified credible contracts, transparent tariffs, accurate measurement and enforceable rules as critical to investor confidence, saying payment, supply reliability and pricing remain key concerns for investors. He said the NMDPRA is developing measurable conditions for the transition to a willing-buyer, willing-seller domestic gas market, based on supply diversity, infrastructure access, contract performance, payment discipline, reliable market data and credible pricing.
The regulator also faces the challenge of balancing investment with affordability. Umar warned that excessively high gas prices could make the commodity unaffordable, while excessively low prices could discourage investment. The planned licensing round is therefore expected to form part of the broader effort to expand gas distribution infrastructure, improve access and create clearer commercial conditions for investment in Nigeria’s domestic gas market.