The National Oil Spill Detection and Response Agency’s most recent data on gas flares indicates that onshore businesses will bear the costs of breaking the gas flaring rule.
According to the agency’s statement, “Companies operating onshore flared 24.5 billion SCF of gas valued at $85.8 million, with $49 million penalties payable.”
As part of the oil production process, gas is burned off or flared. However, the Federal Government had recently led campaigns against flaring and gas monitisation.
The report said organizations erupted 19.14 billion SCF of gas in January and 14.04 billion SCF of gas in February 2023, contributing 1.3 million tons of carbon dioxide emanation, with power age capability of 2,500 gigawatts hours.
On the other hand, offshore businesses flared 25.8 billion SCF of gas that was worth $90 million; capable of producing electricity for 2,600 gigawatt hours and emitting the equivalent of 1.4 million tonnes of carbon dioxide.
In particular, in January and February of 2023, the offshore companies flared 10.84 billion SCF and 13.09 billion SCF of gas, respectively.
NOSDRA didn’t state how much punishments seaward organizations would pay for the flare.
According to NOSDRA, 50.3 billion SCF gas was flared, resulting in approximately N81 billion (176 million) in losses during the review period.
In comparison to the 57.1 billion SCF of gas flared during the same time period in 2022, the volume of gas flared in both months was 11.9% lower.
The oil slick remediation organization noticed that the gas erupted in the period under survey was comparable to carbon dioxide emanation of 2.7 million tons and has power age capability of 5,000 gigawatts hour of power; despite the fact that the companies are responsible for penalties totaling $101 million, or about N46 billion.
Shell Petroleum Development Company, which reported gas flaring from Oil Mining Leases 11, 13, 14, 17, 18, 22, 23, 26, 28, 30 and 39, among others, was one of the affected businesses, according to the NOSDRA report. Nigerian Agip Oil Company, which stated that OML 61 and 62 had gas flaring; as well as Chevron Nigeria, which discovered gas flaring in OML 49, 54, and 95, among other locations.
Other impacted organizations incorporate Mobil Creating Nigeria, Nigerian Petrol Improvement Organization, Addax Petrol Restricted, Famfa Oil and Mythical being Petrol, among others.
NOSDRA lamented that gas has been flared in Nigeria since the 1950s, despite efforts to reduce it. This has resulted in the release of carbon dioxide and other gaseous substances into the atmosphere and has consistently posed health and environmental issues in oil-producing regions.
Prof. Olalekan Olafuyi, Chairman of the Society of Petroleum Engineers, SPE Nigeria Council, stated that the Federal Government would increase penalties for gas flares as Nigeria worked toward meeting its commitment to the UN’s net zero goals by 2060.
He stated that the council was collaborating closely with the Nigerian Upstream Petroleum Regulatory Commission on the issue, but he did not specify the magnitude of the increase in flare rates.
“We are working intimately with the Nigerian Upstream Petrol Administrative Commission, and I can completely say that organizations who flare gas will presently pay more than those using it. Therefore, he stated, “it will be to their advantage to begin considering ways to utilize their gas instead of flaring them.”
Companies that produce more than 10,000 bpd currently pay a fine of $0.5 per 1000 bpd, while those that produce less than 10,000 bpd pay a fine of $2 per 1000 Standard scf of gas flared. Each 1000 scf of gas flared receives $0.5.
The Deputy Managing Director, Deep Water, TotalEnergies EP Nigeria, Victor Bandele, said Nigeria would benefit colossally by changing over erupted gas into business use.
