Wabba decries high cost of gas to GENCOs, mulls $1.50 per MMBtu

Miffed by what it described as deliberate ploy to strangulate local businesses, the Nigeria Labour Congress has impressed on the federal government the need to make gas readily available and affordable to electricity generation companies by reducing its cost.



In a statement issued by the NLC President, Comrade Ayuba Wabba, Labour said it was persuaded to make the appeal as a result of numerous enquiries from workers and members of the Nigerian public alike concerning the reported slash of domestic gas prices for electricity generation and its lack of noticeable impact or reduction of electricity tariff.

In the statement which reads in part, the Congress said, “The underlying statement of gas price reduction was attributed to the Minister of State for Petroleum Resources, Timipre Sylva, as widely reported in the local media of 2nd August 2021. The Minister at the 2021 Gas Stakeholders Forum in Kano reportedly announced that the Federal Government had approved the reduction of domestic gas prices for electricity generation from $2.50 to $2.18 per standard cubic feet (SCF).

“It is partly as a result of the misgivings generated by the policy statement of the Minister of State for Petroleum that Congress is compelled to issue this statement. The purpose is to openly ventilate the agreed position between the Federal Government and Organised Labour on gas pricing as a critical factor in the computation of electricity tariff.”

While citing the agreement between Labour and government at the meeting to set up an FGN-Organised Labour Technical Committee on Electricity Tariff, the NLC boss recalled that “The Technical Committee thus set up on 28th September 2020 had a clear mandate to review several critical issues in the power sector and to suggest reforms that will provide succour to Nigerians over the short and long term. “The Technical Committee submitted its final report to the Principals at the close of January 2021. The meeting of Principals convened on 22nd February 2021 and discussed the report. The Principals accepted among other recommendations that “necessary actions should be taken to use efficiency to bring the gas price to below $1.50 per MMBtu.”

Consequently, Wabba said, “Congress demands of the Federal Government to reduce the pricing of domestic gas supply to GENCOs to less than $1.50 per SCF. We also demand that payment for gas by GENCOs should be denominated in Naira. Finally, Congress demands that the Federal Government should respect the agreement it reached with Labour on electricity tariff. Congress remains implacably committed to the ultimate reduction of electricity tariffs by N15 per kilowatt-hour by December 2021 as contained in the agreement. Congress hereby serves notice that the posture of the Federal Government to flout agreements is completely unacceptable and would be resisted.”

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