The company currently has an on-grid license of 685MW but generates 191MW of electricity.
Nigeria's national grid is under pressure as a shortage of fresh gas supplies is slashing power generation in Africa's most populous country, leaving millions without reliable power during the holiday season, when demand typically peaks.
The situation worsened on Tuesday when the Nigerian National Grid confirmed that generation companies are struggling with gas supply shortages, limiting their ability to maintain optimal production and operating frequency.
This revelation comes as distribution companies (Discos) in the southern regions of the country are implementing aggressive load-shedding measures to prevent entire system collapse.
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“Gencos are experiencing gas supply constraints, which are impacting their optimal output and normal operating frequency,” National Grid said in a post on Twitter. Underscoring the seriousness of the problem, which has plagued Africa's largest economy for decades despite its status as the continent's biggest gas producer.
Industry players have linked the gas outage to the explosion incident that occurred on December 10 at the Escravos-Lagos Pipeline System (ELPS) in Warri, south-west of Delta State.
“The explosion at ELPS in Delta State has affected the ability of gencos connected to the pipeline to get gas for power generation,” said a senior executive manager of a power company.
On Tuesday, Enugu Electricity Distribution Company (Enugu Disco), which provides service to the South-East through five subsidiaries including Mainpower and Transpower, warned customers that the reduced power allocation from the Transmission Company of Nigeria (TCN) has had a direct impact on the quality of service.
These measures have directly reduced electricity allocations to distribution companies, thereby reducing the quantity and quality of electricity available to millions of customers in states including Enugu, Anambra, Ebonyi, Imo and Abia.
Emeka Ezeh, Head of Corporate Communications at Enugu Discos, said, “The recent decline in the availability of power supply is due to the low system frequency caused by the gas shortage affecting the generation companies. This development has necessitated load shedding of available energy by the Transmission Company of Nigeria.”
In southern Nigeria, Port Harcourt Electricity Distribution attributed the current outages to poor production and allocation from power producers and grid operators.
The company, which serves the heart of Nigeria's oil and gas producing region – Rivers, Bayelsa, Cross River and Akwa Ibom states – urged customers to exercise patience while generation companies work to improve production.
“Please be informed that the current load shedding in all our franchise areas is a result of poor generation and allocation from the generation company and the NCC,” the Port Harcourt Discos said.
“We appeal to our respected customers to exercise patience as the Genco team works diligently to improve production and allocation. We apologize for all inconvenience.”
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voices from the dark
The technical explanations provide cold comfort to Nigerians enduring the harsh reality of power failures during the festive season.
Chioma Nwosu, a restaurant owner in Ikoyi, said the cuts have destroyed his leisure business.
“We've probably had six hours of electricity in the last three days,” he said, watching his generator drink diesel, which now costs more than the food he sells. “Christmas orders are piling up, but I can't keep my freezer going. I've lost thousands because of bad ingredients.”
In Ikeja, an affluent GRA neighborhood, software developer Tunde Adeyemi has given up efforts to work from home. “The power situation has made it impossible to work remotely,” he said on X.
Small manufacturers are feeling the most pressure. Patience Okonkwo runs a small textile printing business in Shomolu, Lagos and employs eight workers. “We've sent people home early four times this week,” he said. “No power means no production. These are seasonal orders we are losing, they will not come back in January.”
The timing couldn't be worse. Electricity demand traditionally increases in December as businesses ramp up year-end operations, families host gatherings, and urban residents return home with electrical appliances as gifts. Nigeria's tropical heat requires air conditioning units to run continuously, while cold storage for perishable holiday goods depends on available capacity.
“We have gas, but we can’t deliver it reliably to the plants,” said Aisha Mohammed, an energy analyst at the Lagos-based Center for Development Studies.
“Infrastructure is inadequate, the pricing mechanism does not incentivize domestic supply, and the payment chain is broken. Generation companies cannot pay gas suppliers because distribution companies cannot collect from consumers because tariffs do not reflect costs.”
The World Bank estimates that Nigeria loses about $29 billion annually due to unreliable electricity supply, which is about two percent of gross domestic product.
“Every business in Nigeria essentially operates two power systems, the grid and their backup,” Mohammed said. “During the holiday season, when you should be maximizing production, you are instead maximizing costs on diesel and generator maintenance. This is not sustainable.”
infrastructure is under pressure
The crisis highlights a fundamental contradiction in Nigeria's energy sector: the country has Africa's largest proven natural gas reserves, about 209 trillion cubic feet, yet domestic gas supply remains chronically inadequate for power generation.
Industry analysts point to a set of structural problems that prevent gas from consistently reaching thermal plants.
Poor infrastructure tops the list of obstacles. Pipeline networks have suffered from decades of underinvestment, with aging facilities prone to breakdowns and efficiency losses.
Security challenges arise due to infrastructure vulnerabilities, as vandalism and theft on gas transmission routes disrupt supply chains. In the Niger Delta, militant activities and community disputes have periodically shut down production facilities and damaged critical pipelines.
The absence of strong take-or-pay contracts, where buyers commit to paying for a minimum gas volume, whether delivered or not, leaves gas producers with insufficient revenue certainty to justify infrastructure investments.
Meanwhile, domestic gas pricing regulations have historically kept prices below market rates, discouraging producers from prioritizing local supply over more lucrative export opportunities through liquefied natural gas facilities.
Payment failures create additional friction throughout the electricity value chain. Generation companies often struggle to pay gas suppliers as distribution companies fail to remit revenues collected from consumers, who themselves face irregular billing and arbitrary charges. This cycle of dysfunction leaves the entire system financially constrained and operationally compromised.
To ordinary Nigerians, technical explanations matter little.
“We have been asked to be patient,” Tunde Adelakun, a supplier of frozen food based in Ijegun, Lagos, told BusinessDay. “But patience won't keep my food fresh or my kids comfortable. This is supposed to be the 21st century, not the Stone Age.”
