Power crisis looms as GenCos confirms presidency awareness of gas cut-off

Wholesale gas producers have officially informed all power generation companies of the suspension of natural gas supply.

This revelation was made by Joy Ogaji, the Chief Executive Officer of the Association of Power Generation Companies, during an interview with Punch.

The supply halt is attributed to unpaid debts from previous transactions.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) reportedly directed gas producers to cease supply to indebted GenCos, citing mounting debts as the reason for this decision.

This action has triggered a nationwide power outage, significantly disrupting electricity generation across the country.

Gas-fired power plants account for over 70% of Nigeria’s electricity generation. Although the government recently paid ₦205 billion toward the debts owed to GenCos, a dispute between the NMDPRA and gas producers over who should collect the 0.5% wholesale price levy mandated by the Petroleum Industry Act has further complicated matters.

This disagreement prompted gas producers to demand payment of the outstanding debts.

According to Ogaji, the total debt, which stood at ₦2 trillion earlier this year, has now escalated to ₦2.7 trillion. She noted that all relevant authorities, including the presidency, have been informed of the situation, and necessary interventions are being awaited.

She said, “It is no longer a matter of NMDPRA giving a directive. They have already stopped the supply of gas to power-generating companies.

“They (gas suppliers) have halted the supply. They have already informed our gencos that they are not going to be supplying gas anymore until what is outstanding is settled and it didn’t happen today.

“We have told the Nigerian Electricity Regulatory Commission, they are already aware of the situation. There is nobody who would say they are not aware; the minister is aware, and the presidency is aware.

“The total debt has now increased to over N2.7tn and you know that 70 per cent of thermal Gencos invoice is gas.

“They have been paying a small amount. So, when they pay us nine per cent, we just calculate nine per cent of our gas invoice and send it to the gas supplier because that is the only way to survive. We are all sharing in the poverty that NBET is giving us.”