In 2018, Africa’s biggest oil producing country threw N306 billion into the flames through age-long gas flare practice, in spite of its potential for development into cooking gas and other products to reduce environmental pollution.
Millions of people live within five kilometres of a gas flare site in the oil-rich Niger Delta region of south-south Nigeria. Below the flames, they’re extracting oil. With the oil comes unwanted gas, which is burnt off in a process called gas flaring.
Analysis by BusinessDay showed from January 2018 till December 2018, Nigeria flared a total of 282.05 billion standard cubic feet (SCF) flared translating to a total cost of $846 million (N306 billion) using the average 2018 price of natural gas of $3 per 1,000scf.
Analysis of the NNPC report using 2018 average cost of $3 per 1,000 SCF showed in January Nigeria flared 31.68 billion SCF of gas worth $95 million, in February 27.25 billion SCF was flared worth $81.75 million while in March and April, Nigeria flared 26.88 billion SCF and 23.06 billion SCF worth $80.64million and $69.18 million, respectively.
The oil and gas companies, which include international and indigenous operators, also wasted 21.20 billion Scf of gas in May worth $63.6million, 21.66 billion SCF in June worth $64.98 million, 21.21 billion Scf in July worth $63.63million, 22.42 billion Scf in August worth $67.26 million, and 20.54 billion Scf in September worth $61.62 million.
In October 2018, Nigeria flared 20.51 billion Scf of gas worth $ 61.53 million while in the month of November and December respectively the country flared 23.78 billion Scf and 21.89 billion scf worth $71.34 million and $65.67 million respectively.
“It’s a sad story and a combination of several factors which cut across the value chain; the gas flared away in Nigeria would have been able to address some of the challenges facing our gas-to-power plants,” Luqmon Agboola, head of energy and infrastructure at Sofidam Capital, said.
Agboola explained that there are still major bottlenecks in infrastructural operational capacity which needs to be addressed in order to solve the menace of gas flaring.
The NNPC data revealed out of the 240.59BCF of gas supplied in December 2018, a total of 151.13BCF of gas was commercialized while 38.61BCF and 112.52BCF supplied to the domestic and export market respectively.
“This translated to a total supply of 1,245.48 million standard cubic feet (mmscfd) of gas to the domestic market and 3,748.47mmscfd of gas supplied to the export market for the month,” NNPC said in its report.
NNPC noted that 62.61percent of the average daily gas produced was commercialized while the balance of 37.39percent was re-injected, used as upstream fuel gas or flared in December 2018.
NNPC said Gas flare rate was 9.15percent in December 2018 i.e. 729.55mmscfd compared with average Gas flare rate of 9.92opercent i.e. 777.37mmscfd for the period December 2017 to December 2018.
The NNPC further said that the Total gas supply for the period December 2017 to December 2018 stood at 3,074.92BCF out of which 469.73BCF and 1,328.98BCF were commercialized for the domestic and export market respectively. Gas –Injected, Fuel gas and Gas flared stood at 1,276.22BCF.
Since the 1950s when Nigeria started oil production, gas has been flared indiscriminately by the oil companies operating in the country, despite its many implications. Yet legal efforts to reduce gas flaring and convert the resources into productive use such as generating electricity have never really come through.
According to the World Bank’s rankings Global Gas Flaring Reduction Partnership from July 2018, Nigeria is the sixth largest gas flaring country globally and the second largest in Africa after Algeria, moving up from the seventh global flare the year before.
In a country where 27 per cent of Nigerians do not have access to electricity, many residents of communities living near gas flares are aware of the irony of the burning of a resource which could be converted into power.
