Nigeria Issues First Gas Trading Licence to Boost Market Transparency and Liquidity
Nigeria has taken a major step to modernize its domestic gas market by issuing the country’s first Gas Trading Licence to JEX Markets Limited. The licence, granted by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), authorizes the company to operate a Clearing House and Settlement system, paving the way for standardized pricing, improved liquidity, and greater transparency in gas transactions. The ceremony, held in Abuja, brought together government officials, regulators, investors, and gas producers.
Farouk Ahmed, Chief Executive of NMDPRA, explained that the licence establishes a technology-driven platform for wholesale gas trading. “The system will support transparent price discovery, real-time automated trading, and wider participation from producers, transporters, and industrial buyers,” he said. Ahmed emphasized that the move aligns with Section 159 of the Petroleum Industry Act 2021, which mandates a regulated framework for wholesale gas transactions.
The initiative is expected to address persistent challenges in Nigeria’s gas sector, including pricing opacity, transaction bottlenecks, and low investment levels. According to Ahmed, the licence will enhance market confidence, encourage participation, and make gas trading more efficient, reliable, and investor-friendly. By providing a clear framework for settlements and trading, the platform aims to unlock new opportunities across the sector.
Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, noted that the development supports President Bola Tinubu’s Renewed Hope Agenda. He described gas as “the backbone of Nigeria’s future energy security, industrialization, and economic diversification,” adding that the new trading system will improve access, dependability, and affordability. The structured trading environment will reduce risks for counterparties and promote competitive pricing, benefiting industrial and commercial off-takers.
The introduction of the Clearing House Authorisation also marks a milestone for investor protection and risk management. Securities and Exchange Commission Director-General Emomotimi Agama highlighted that the platform transforms gas into a tradable financial asset, attracting investment and supporting infrastructure growth. Combined with efforts to secure pipelines and curb illegal refining, the initiative promises to standardize contracts, guarantee settlements, and provide clear pricing signals, strengthening Nigeria’s domestic gas market for years to come.
source: The Guardian