• GACN’s core mandate and rationale are directly linked to FGN’s economic development plans and NNPC’s Gas Sector development objectives; thereby, requiring ongoing FGN ownership linkage.
• Giving private entities control over GACN is extremely risky and would undermine NNPC and FGN’s ability to leverage on the Gas Sector through GACN to improve Economic Development.

• GACN is commercially neutral being a “not for profit” entity.
• It’s operating budget is funded by Gas Sellers and Buyers based on Sellers Domestic Gas Supply Obligations and Buyer’s offtake volume.
• GACN’s funding could be further improved by basing it on minimal surcharge/fee per GACN operationalized transaction.

• GACN is a creation of FGN’s Regulation and almost all its core mandates stipulate an ongoing role.
• Commentators often confuse GACN’s aggregation role as its sole mandate and therefore question its continued relevance upon the future attainment of “willing buyer-willing seller.”

No

It performs roles which are akin to an Agency.

 No

Currently NGMC and SNG

• GACN does not sell natural gas to industries or manufacturing companies. Such business purchases their gas from Local Distribution Companies (LDCs) who buy gas from GACN.
• GACN does not produce, process, or transport natural gas.
• GACN does not build gas pipelines or gas infrastructure.
• GACN is not a regulator.

• Buyer logs gas request with GACN through an introductory letter indicating gas use, volume and plant location.
• GACN invites Buyer to an introductory meeting wherein Buyer is expected to make a formal presentation of proposed project. In conclusion, GACN also presents its roles and responsibilities in the domestic gas market and gives an outline of the Due Diligence process.
• Buyer makes payment of mandatory processing fee to access DSO gas within GACN framework.
• On confirmation of receipt of payment of the above fee, GACN issues Due Diligence documents to Buyer.
• Buyers receives and issues acknowledgement for gas request form and Due Diligence Questionnaire.
• Buyers completes Gas Request Form (GRF) and Due Diligence (DD) Questionnaire.
• Simultaneously, GACN executes Confidential Agreement with the Buyer.
• Buyers submits completed DD Questionnaire and GRF to GACN
• GACN evaluate buyer’s submission based on DPR approved methodology. As part of the process, GACN carries out a site verification visit to the Buyer’s proposed project/facilities and if successful at the end of the evaluation, progresses to the Gas Demand Pool.
• GACN allocates Gas Sellers (S) and indicative Transporter to Buyers’ accepted to Gas Demand Pool, based on gas availability and delivery time of project.
• GACN facilitates negotiation and execution of GSAA (Gas Sale and Aggregation Agreement) between the Buyer & Seller(s).

• Power generation companies whose sole business is to generate power into the national grid.
• Companies who use natural gas as feedstock for their products, such as fertilizer and petrochemicals. I.e. Gas based industries.
• Local distribution companies who sell natural gas to commercial and manufacturing companies in the domestic market I.e.

• According to the national Domestic Gas Supply and Pricing Regulation, any suppliers who does not comply with its Domestic Gas Supply Obligation shall:
• Pay for the volumes not supplied based on the take or pay provision of the executed GSAA or at a price of US$3.50/MScf, whichever is higher (This is an after tax penalty, not cost recoverable)
• Not be allowed to supply gas to any export project, in addition to any other penalties the Minister may deem fit.

• DSO means Domestic Supply Obligation.
• In a bid to kick start the Nigeria Domestic Gas Market, the Federal Government of Nigeria (FGN) introduced the DSO volumes through its National Gas Supply & Pricing Policy 2008.
• Implementation of the National Gas Supply & Pricing Policy 2008 mandates all gas (Associated Gas & Non Associated Gas) producers to dedicate a specific portion of their gas reserves and production for supply to the Nigerian domestic market. Theses DSO Volumes are assigned by the FGN through the DPR.
• Periodical reviews to the Domestic Gas Obligation will take place to reflect the changing demographics of the demand and supply landscape.

• The Aggregator is not a regulator but a regulated entity. It is regulated through the Department of Petroleum Resources (DPR) within the Ministry of Petroleum Resources.
• GACN interfaces with the Regulator on due diligence process for buyers, demand rationing criteria, and domestic supply obligation management.

• GACN is not a cartel of gas producers.
• As the Aggregator, GACN acts to protect the interest of both buyers and sellers in the Nigerian domestic gas market.
• GACN conducts due diligence on buyers before allocating their requested volumes to sellers based on Domestic Supply Obligation.
• Interfaces with suppliers to ensure they have firm supply plans that will meet the requirement of buyers.
• GACN has operated in a fairly independent manner till date. It is however recommended that the equity holding of the Other Shareholders be reduced by 6% each and the resultant aggregate of 30% equity be allotted to 6 major gas offtakers across the 3 sub-sectors (Power, GBI and Commercial.)

• Acts as an intermediary between suppliers and purchasers of gas in the domestic market and ensure the supply of gas to the Strategic Sectors in accordance with the approved national gas pricing framework.
• Implement a Gas Management Model through which the demand and supply of gas for utilization within Nigeria shall be monitored.
• Operate a nomination and balancing mechanism for equitable curtailment of gas production whenever demand and supply expediencies are required.

• Gas Aggregation Company Nigeria Limited (GACN) is the Strategic Aggregator established by the Nigerian Gas Supply and Pricing Regulation, “The Regulation, 2008”. Its primary mandate is to allocate natural gas to strategic sectors for domestic utilization in Nigeria.
• In addition, it acts as an intermediary between suppliers and buyers of natural gas in the Nigerian domestic gas market.
• The Aggregator manages the receipts of payment for gas sales and disbursement of same to suppliers through the computation of an aggregate gas price
• Facilitate the execution of necessary securities in respect of default of gas payment through the execution and administration of a Gas Sale and Aggregation Agreement.