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‘Nigeria Lost $1.150bn of Potential Gas Income to Flaring in 2016’
Chineme Okafor in Abuja
In 2016 alone, Nigeria could not earn about $1.150 billion potential gas revenue because as much as 275 billion cubic feet (BCF) of natural gas were flared from oil fields in the Niger Delta, a taskforce of the federal government has said.
The taskforce – Nigerian Gas Flare Commercialisation Programme (NGFCP) – which is situated in the ministry of petroleum resources and chiefly responsible for designing the programme to commercialise the volume of gas flared in country, explained that in addition to revenue lost, the flared gas could have generated 3000 megawatts of electricity for Nigeria, but could not.
According to the NGFCP, the monies lost by Nigeria to flared gas were in two forms – $800 million in revenue and $350 million that could have been earned in emission credit.
The NGFCP Steering Committee Chairman, Mr. ‘Gbite Adeniji, who is also a senior technical assistant (STA, Upstream and Gas) to the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, stated this in a recent presentation he made to the Executive Secretary of the Petroleum Technology Development Fund, Dr. Bello Gusau, when he visited him at the PTDF headquarters in Abuja with his team.
In the presentation which was obtained by THISDAY, Adeniji, explained the NGFCP had identified 179 gas flare sites spread across on-shore, swamp, shallow offshore and deep offshore areas of the Niger Delta region.
He stated that these sites were burning an approximate volume of about 750 million standard cubic feet per day (mmscf/d) of gas.
According to him, in 2016 alone, about 275BCF of gas was flared, which he noted could have generated about 3000MW of electricity; generated about $800 million in revenue and earned about $350 million emission credit value.
‘Gbite, equally indicated that recent data obtained by the programme placed the figure of flared gas volume at about 1BCF per day, suggesting an increase from the 2016 figures.
He listed the intentions of the programme to include reduction of gas flaring in the Niger Delta; as well as initiation of a market-driven solution for the flares to benefit the communities and Nigeria’s economy.
He informed that President Muhammadu Buhari, has approved a regulations developed by the NGFCP to legally back its operations which would include harnessing all flare gas free of cost at the flare sites without payment of royalty; subjecting the flare sites to competitive bidding; issuance of permit to access flare gas to third party investors; increase the flare penalty payment to the government; mandate flare gas data measurement through metering; and mandate the department of Petroleum Resources (DPR) to publish annual data on flared gas.
‘Gbite, equally sought the involvement of PTDF in the NGFCP especially in cases of partnership to develop and implement strategies towards building human and institutional capacity to support the flare-out programme.
He also informed that he wanted the PTDF to assist in developing strategies to support the NGFCP with training in matters connected with the gas value chain, as well as the development of indigenous manpower and technology acquisition on gas flare reduction projects.
Based on ‘Gbite’s requests, Gusau, said the PTDF would be ready to partner with the NGFCP especially in the areas of capacity development to ensure the country’s efforts at reduce gas flaring through harnessing of flared volumes would be realised.