By Ayo Susan
The Nigerian National Petroleum Company Limited (NNPCL) announced plans to increase domestic gas supply by 1.8 billion cubic feet per day (cf/d) in 2026. The increase will come from NNPC Upstream Investment Management Services adding 1.496bcf/d and Nigerian Exploration and Production Limited contributing 223.6mmscf/d.
The programme forms part of the Gas Master Plan, targeting national output of 10bcf/d by 2027 and 12bcf/d by 2030, aimed at meeting rising demand across LNG, power generation, industrial parks and compressed natural gas usage.
Engr. Bayo Ojulari, Group Managing Director of NNPC, said: “The plan is designed to deliver the presidential mandate of increasing national production to 10bcf/d by 2027 and 12bcf/d by 2030, while catalysing over $60 billion in new investments across the oil and gas value chain by 2030.”
DECISION HIGHLIGHT
Government energy strategy is shifting from oil revenue dependence to domestic gas industrialisation, using supply expansion targets as the anchor for investment mobilisation.
DECISION MEMO
The announcement reflects a familiar pattern in Nigerian energy policy, ambitious production targets preceding market reforms. Gas output expansion historically fails not because of geology but because of demand chain dysfunction, especially in power sector payment discipline.
The hub-based model attempts to solve a structural inefficiency. By clustering assets into 23 priority hubs, infrastructure duplication may decline and project bankability may improve. However, supply expansion alone does not create a market. Gas producers invest only when payment reliability exists across the value chain.
Ojulari’s emphasis on governance, incentives and funding implicitly acknowledges this constraint. The requirement for “competitive fiscal and commercial incentives” indicates Nigeria still prices gas below risk-adjusted capital thresholds, particularly in deepwater development where capital intensity is high and payback periods long.
The reference to power sector reform is critical. Gas-to-power remains Nigeria’s largest stranded demand segment. Increasing production without resolving electricity distribution liquidity simply converts upstream investment into receivables exposure.
Therefore, the plan is less a production roadmap and more a financing thesis. The $60 billion investment ambition depends on converting gas demand from theoretical consumption into bankable cash flow.
DATA BOX
Additional supply 2026: 1.8bcf/d
NUIMS contribution: 1.496bcf/d
NEPL contribution: 223.6mmscf/d
Target 2027: 10bcf/d
Target 2030: 12bcf/d
Projected investment mobilisation: over $60bn by 2030
Identified development hubs: 23
WHO WINS / WHO LOSES
Winners:
Industrial manufacturers reliant on stable energy supply
Gas processing and infrastructure contractors
Investors in LNG and CNG value chains
Losers:
Oil revenue dependence if transition accelerates
Power distribution companies unable to meet payment obligations
Projects dependent on administratively priced gas
POLICY SIGNALS
Authorities are attempting to reposition gas as Nigeria’s transition fuel and domestic industrial backbone. Future energy policy may prioritise utilisation economics over export revenue maximisation.
INVESTOR SIGNAL
Investment viability hinges less on reserves and more on contract enforceability. Capital will follow if gas sales become creditworthy rather than politically priced.
RISK RADAR
Primary risk is power sector liquidity failure undermining gas payment security.
Secondary risk is fiscal terms remaining uncompetitive for deepwater gas.
Tertiary risk is demand projections overstated relative to infrastructure readiness.
Production targets alone do not unlock gas economies. Payment certainty does.
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