$1.150 billion of Nigeria’s potential gas income lost to flaring

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A taskforce from the federal government of Nigeria, revealed that in 2016, the country failed to earn about $1.150 billion potential gas revenue because 275 billion cubic feet (BCF) of natural gas were flared from oil fields in the Niger Delta.

The Nigerian Gas Flare Commercialisation Programme (NGFCP), which is situated in the ministry of petroleum resources, explained that in addition to the revenue lost, the flared gas could have generated 3000 megawatts of electricity for Nigeria.

According to the NGFCP, the money lost by the country to flared gas were in two forms, $800 million in revenue and $350 million that could have been earned in emission credit. Mr. Gbite Adeniji, NGFCP Steering Committee Chairman, stated that in a recent presentation he made to the Executive Secretary of the Petroleum Technology Development Fund, the NGFCP had identified 179 gas flare sites spread across on-shore, swamp, shallow offshore and deep offshore areas of the Niger Delta region.

Adeniji explained that recent data obtained by the programme placed the figure of flared gas volume at about 1 BCF per day, suggesting an increase from 2016 figures.

According to Adeniji, President Muhammadu Buhari has approved┬áthe regulations developed by the NGFCP. The regulations were designed to reduce gas flaring in the Niger Delta and provide a market driven solution for the flares to benefit communities and Nigeria’s economy.

The operations implemented by the NGFCP will include harnessing all flare gas free of cost at the flare sites without payment of royalty, subjecting the flare sites to competitive bidding and issuance of permit to access flare gas to third party investors.

Other operations to be implemented by the NGFCP include: to 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.

To develop and implement strategies towards building human and institutional capacity to support the flare out programme, Adeniji says its imperative to get the Petroleum Development Technology Fund to assist the NGFCP.


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