The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has issued operating licenses to JEX Market to establish and operate a Gas Clearing House and Settlement
Authorisation Platform.
Issued in conjunction with the Securities and Exchange Commission (SEC), NMDPRA said on Tuesday the platform would serve as a commodity exchange where natural gas and its derivatives would be traded in Nigeria.
The midstream and downstream petroleum industry reguIatory authority described the platform as one of the most strategic collaborations between it and other government-owned agencies,
The issuance of the operating licences, NMDPRA said, was not only one of the game-changing outcomes of the Petroleum Industry Act (PIA) 2021, but also the product of the strategic thinking of the present administration towards creating value and market for the country’s abundant gas resources.
“Indeed, it is also a testimony to the commitment and capacity of the JEX Market as a competent energy commodity trader and an exchange operator,” the NMDPRA said.
The agency said the issuance of the Gas Trading Licence and Gas Clearing House and Settlement Authorisation by the NMDPRA as well as an approval for Registration as Licenced Commodity Exchange by the SEC followed a rigorous and extensive due process procedure by the relevant regulatory agencies.
“The platform is expected to become operational soon, making it
the first of its kind on the African Continent, thereby placing Nigeria
in its rightful place as the hub for energy transactions in the region,” the NMDPRA said.
Also, it said the platform would allow for more efficient, transparent and swift trading of Natural Gas commodities in Nigeria and the African region, thereby accelerating the growth of Nigerian Energy sector
towards a mature market.
As the market matures, the agency said the platform would encourage more investment into the
sector, creates more employment opportunities and wealth
creation, increases government revenue and allows easier auditing
of transactions by relevant agencies and parties.
These licences, it pointed out, are coming at an opportune time marking the two years of the present administration, particularly as Nigeria approaches the half-mark of the Decade of Gas journey.
The agency described the establishment of the exchange platform as a testimony to the success of the policy decisions of the current administration and a clear indication that the Decade of Gas programme was well on track to achieve its objectives by the year 2030.
Besides, it noted that the regulatory synergy that led to the attainment of this feat between the NMDPRA and the SEC marks a very good example of the values that the nation stands to gain when agencies work together.
“The establishment of the platform is a step further in the renaissance
of the Nigerian Energy landscape being championed by domestic
entrepreneurs who are increasingly executing bold initiatives under
the conducive environment being provided by regulatory
agencies.
“It is expected that this achievement would provide further impetus to other strategic undertakings by players in the energy sector to wean Nigeria from energy poverty, consolidate the country as the energy hub of the continent, spur industrialisation and deepen the hope for a sustainable and competitive future for the country,” it said.
