ABUJA, April 5 (Reuters) - Nigeria is urging its multinational oil partners to allow third-party suppliers to sell gas to produce liquefied natural gas (LNG) at market rates to boost exports in a bid to tap demand in Europe, a junior oil minister said on Tuesday.
Timipre Sylva, minister of state for petroleum, said Nigeria LNG (NLNG) joint partners - state-oil firm NNPC, Shell, TotalEnergies and Eni - supply gas at subsidized rates to produce LNG for export.
This has left NLNG with insufficient gas supply and producing LNG at around 70% of its capacity, meaning it is unable to meet its local and foreign gas obligations, Sylva said.
"The partners are insisting that they can only allow third-party supply gas to the plant only if they agree to supply at subsidized rates," he said during a meeting with Sefano De Leo, Italy's new ambassador to Nigeria.
NLNG is the country's only LNG company and has a total production capacity of 22 million tonnes per annum (mtpa) of LNG and 5 mtpa of Natural Gas Liquids (NGLs) from its six-train plant complex.
The European Union is seeking to diversify its energy sources, De Leo said, especially after sanction were imposed on Russia, its biggest gas supplier, following its invasion of Ukraine in February.
Nigeria, which has the world's ninth largest proven gas reserves, has been facing severe power shortages since February due to gas shortages which have stymied generation leaving many people dependent on private generators. (Writing by Chijioke Ohuocha Editing by Marguerita Choy)
Eni (ENI.MI)