The Nation Newspaper

Tag: flaring

  • Flaring: Green energy builds $12m LPG

    In order to avert gas flaring, the Green Energy International Ltd, operators of Otakikpo Marginal field  in OML 11, is now building a $12million Liquefied Petroleum (LPG) plant  in Ikuru Town in Rivers State that will be ready for installation by the 2nd quarter of 2019. The 12MMSCFD  capacity plant is being constructed in China  at a cost of over 12 million dollars.

    Disclosing this at the first  stakeholders interactive luncheon held in Port Harcourt, the Chairman of the company, Professor Anthony Adegbulugbe, said this was one of the unique projects of the company to ensure zero gas flare in the the Niger Delta, under its small scale gas utilization programme “SSGUP”. This was contained in the statement which the Director, Legal & Corporate Affairs, Olusegun Ilori released to reporters yesterday.

    The statement also noted that  the host communities are to enjoy uninterrupted power supply through the company’s gas to power project, with 6 MW gas generators already on site for installation process. He said the company has secured a 15 MW power generation license from the National Electricity Regulatory Commission (NERC) and efforts are being made to increase to 40Mw.

    Reeling out other plans of the company in its phase 2 development, Adegbulugbe said the company had just completed a 3D seismic campaign to understand the field with a view to  drilling more wells in the area, while an onshore export terminal is also being proposed to be established by 2020. He said the company which started production in 2017 was producing  6000bopd, adding that it planned to ramp up production to 20,000  bopd in the next few years.

    He commended the traditional rulers and the people of the area for their support and cooperation with the company in achieving tremendous progress adding that this was a  prove that its unique programme of taking the communities as partners in its development effort was not misplaced. He said the company and its technical partner Lekoil, has patronized  local  community contractors since its inception with over N3billion worth of procurement contracts.

  • CSOs demand N3.3tn penalty for gas flaring 

    Members of the Civil Society Organisations (CSOs) have made a case for the international oil companies (IOCs) payment of the outstanding N2.3trillion gas flaring penalty funds to host communities in the Niger Delta region.

    They also pushed for the payment of about N1trillion gas flaring penalty fund that the multinationals have already paid which remained hitherto trapped in the Central Bank of Nigeria (CBN).

    The National Coordinator, Centre for Peace and Environmental Justice (CEPEJ), Comrade Sheriff Mulade and Faith Nwadishi of the Independent Service Delivery Monitoring Group, made this known in Abuja during the media briefing on security and environmental challenges in the Niger Delta and Nigeria.

    Mulade said that CEPEJ has packaged a conference for 7th and 8th November, 2017 in Benin-City, Edo State to examine the rising tide in environmental degradation, and  avoidable perpetuation of poverty in the Niger Delta through the oil companies activities, persistent gas flaring, loss of adequate life and agitations in the region and Nigeria.

    He also noted that despite the federal government’s  flag-off  of the Ogoni clean up several months ago, it has remained a mere political promise.

    He appealed to the government that for it to sustain the existing peace in the region, the Ogoni axis of Rivers State, it should expedite action on environmental remediation and the clean up it promised.

    According to him, this will bring about sustenance of peace and development in the region, also reduce tension and further crisis in the area.

    On the gas flaring penalty fund, Mulade said that: “We are aware that there is a penalty paid by these multi-nationals. We are also aware of the three percent being paid to NDDC by the IOCs to develop the Niger Delta.”

    He said although the CSOs are already urging the federal government to pay the fund, it is against the channelisation of the funds through any commission.

    Mulade asked the government to pay the money directly to the communities instead of using any commission as an intermediary that may divert the fund to compensate political allies.

    Speaking, Nwadishi expressed surprise that Nigerians were only talking about payment of N1 trillion gas flare penalty stalled in the apex bank whereas the IOCs still have an outstanding N2.3 trillion gas flaring penalty to pay to the communities.

    She described gas flaring as a negation of the law because a court sitting in Benin- City, has already declared gas flaring as illegal.

    Nwadishi said that : “At the end of the day, we as a country, we are not sincere about our gas flaring policy . Over the years, we have shifted the goal post. Today, we say we want to end, tomorrow, we want to end gas flaring.

    “Now there is a new date 2020 initiative to end gas flaring in Nigeria because of the World Bank initiative that says reduce gas flaring by 2030. For three years we change our goal post.

  • Eni seeks less gas flaring in Africa

    A delegation from Italian energy giant Eni, led by Chief Financial Officer Massimo Mondazzi, has made a presentation to the World Bank to reinforce the firm’s continued commitment to sustainable growth.

    Speaking at the World Bank’s headquarters in Washington, Mondazzi underlined Eni’s resilience in the current economic environment, and spoke of the company’s efforts to allow a wider access to energy in the Sub-Saharan region of Africa.

    One of Eni’s key strategies for the region is the World Bank’s Global Gas Flaring Reduction Partnership (GGFR), a public-private initiative involving international and national oil companies, national and regional governments, and international institutions.

    The World Bank Group is leading the GGFR’s efforts to significantly reduce the amount of gas flared globally. It estimates that flaring resulted in the burning of 147 billion cubic metres of natural gas in 2015, a figure that could generate 750 billion KWh of electricity, which exceeds the current annual consumption of the entire African continent.

    Flaring gas wastes a valuable energy resource that could be used to support economic growth and progress. It also contributes to climate change by releasing millions of tonnes of carbon dioxide (CO2) to the atmosphere.

    “Eni is proud to be a member of the GGFR and we have been in the process of reducing gas flaring at our assets. We are committed to achieving zero process flaring by 2025” Mondazzi said.

    The energy giant has cut flaring by about 75 per cent in the last decade and wherever possible, the gas is made available to the local market for electricity generation, providing access to electricity to over 18 million people in Sub-Saharan Africa.

    “The World Bank recognises that Eni is following up its endorsement of the “Zero Routine Flaring by 2030” Initiative with action on the ground, working to use flared gas for power projects and other applications that reduce CO2 emissions. We also appreciate Eni’s push to deploy and integrate more renewable energy technologies into their business model,” said Riccardo Puliti, Senior Director and Head of the World Bank’s Energy & Extractive Industries Global Practice.

  • Fed Govt frets over increased gas flaring

    Fed Govt frets over increased gas flaring

    The Ministry of State for Petroleum, Dr. Emmanuel Ibe Kachikwu yesterday expressed fears that the establishment of modular refineries may increase the rate of gas flaring in the country.

    Kachiukwu, who was represented by his Senior Technical Adviser on Investment, Dr. Tim Okon, stated this during the presentation of the report on: New Nigeria Oil &Gas Framework and Policy  in Abuja,

    Kachikwu however said that the government will control the operations of the refineries.

    “Modular refineries will worsen our flare. We have to use economics of scale. If we have many refineries they will accentuate problems; so  we will have to control them,” he said.

    He said the Nigerian National Petroleum Corporation (NNP) will next year call for expression of interest for marginal fields, which will be opened for companies’ participation, saying that prior to the exercise, the marginal field policy would have come into force.

    The NNPC, said the minister, will ensure that the Niger Delta gets micro businesses to engage in as the government is keen about providing a business friendly environment.

    Kachikwu said there will be a critical legislation to make gas independent of government subsidy, which has caused significant loss of revenue from the product.

    He said the government wants to make sure that gas can economically stand on its own, adding that in the new scheme of things, government’s intervention in the petroleum sector will focus on developing entrepreneurs to discourage “sharing money that distorts political discourse and value system.”

    Kachikwu said besides oil, Nigeria is a country with deliverable resources, with an educated and aggressive populace.

    Commenting on the economic state of the nation and taking into cognizance of its potentials, he said: “I imagine what Nigeria could become if we do the right thing.”

    He noted that the essence of the seven big wins is to bring out the latent opportunities in the oil and gas system to take a collaborative responsibility to assist those who really want to become players in the field.

    The minister said the sector had been locked down by interest groups for too long positively or negatively, however time has come to open up the areas that are there.

    He pointed out that  it is now the responsibility of the ministry to assist those that have creative ideas about the industry  to “creates employment and development.”

    He recalled that he announced the concept of project 100 in Houston, which is to identify 100 Nigerians with skills, capacities and enthusiasm for the relevant assistance from government.

  • Activist urges Fed Govt to end gas flaring

    An activist, Jonah Gbemre, has urged the Federal Government to enforce a 2005 Federal High Court judgment, which ordered oil and gas companies to end gas flaring.

    Gbemre, who is the Convener of the Host Communities Network of Nigeria (HOCON), spoke at the weekend at a workshop on the impact of gas flare/Environmental Impact Assessment (EIA) and energy transition in Iwhrekan community, Ughelli South Local Government Area of Delta State.

    The event was attended by representatives of the Federal Ministry of Environment as well as environmental activists.

    The activist noted that the continued flaring of gas would endanger the lives of the residents and the environment.

    He regretted that government’s alleged disregard for the safety of the residents in oil and gas exploration areas had been taking place in the last 10 years the judgment was given.

    Gbemre said: “Oil corporations, such as Shell and NPDC, should stop further pollution and gas flaring in Nigeria and at the flare sites in Niger Delta. Government should enforce the court orders of November 14, 2005, delivered by Justice Nwokorie on the need to stop gas flaring in Nigeria without delay.

    “The learned judge held that gas flaring is illegal and it constitutes serious environmental health hazards as well as gross violation of the people’s fundamental human rights as enshrined in the Africa Charter. So, it should be stopped.

    “Gas flare by oil companies in Niger Delta constitutes one of the worst forms of environmental degradation and contributes highly to climate change. The practice has continued primarily because of the unwillingness of government, which acts as the regulator and partner to the oil companies.”

    The activist said he organised the workshop in partnership with the Friends of the Earth to enlighten the residents on the impact of gas flare on their lives.

    He advised the host communities, policy makers, civil society groups and relevant government agencies to end gas flaring.

  • Total ends gas flaring from OMLs 102, 58

    Total Exploration and Production Nigeria Limited (TEPNL)  has completed gas flare down projects in two of its fields, its Managing Director, Nicholas Terraz, has said.

    At the Nigerian Gas Association’s Conference in Abuja, he said the flare out feats were achieved in Total’s offshore field in oil mining lease (OML) 102 and onshore acreage in OML 58.

    He said: “At Total, we are committed to better energy and have had a flare-out policy for producing fields and a no-flaring policy on all new developments since year 2000. The Amenam-Kpono and Akpo developments are examples of this in new projects whilst brown fields flare down projects have been completed in our OML 102 offshore and OML 58, onshore Nigeria.

    “In  a presentation entitled ‘’Harnessing natural gas: New opportunities for Nigeria’s energy agenda,’’ Terraz stated that with about 180 trillion cubic feet (TCF) of proved gas reserves and a potential for 600 TCF of which only 47 TCF is currently developed, natural gas is obviously a key resource for Nigeria, which apart from generating much needed export revenue, will also be a catalyst for rapid economic development especially in the areas of power generation and gas based industry growth.

    Total has been an active partner of the Federal Government and the Nigerian National Petroleum Corporation (NNPC) in the development of Nigerian gas sector. “We are a shareholder in Nigeria Liquefied Natural Gas (NLNG) and have been supplying gas to NLNG plant in Bonny since production started in 1999 contributing to significant reduction of gas flaring in Nigeria,’’he said.

    Total, with its Joint Venture partner NNPC, has built the Northern Option Pipeline (NOPL), a strategic 50 km gas pipeline with a capacity of 300 million standard cubic feet per day (MMSCF/D) designed to supply gas to the Alaoji power plant and other gas based industries in the Eastern domestic market. This is a major contribution to the efforts of the Nigerian government to develop the domestic gas market.  Gas supply to Alaoji plant through NOPL started on October 18, he added.

    He noted some achievements accomplished by the Nigerian Gas Master Plan such as growing domestic gas supply to about 1.3 billion cubic feet per day (bcf/d) from less than 1bcf/d, and export gas to over 3bcf/d.  Gas flaring has reduced from a high of 2.5bcf/d 10 years ago to about 0.8bcf/d today. Some major pipeline projects are either ongoing or have been completed. Escravos Lagos Pipeline 2 (ELPS 2) which will double the ELPS capacity and the Obiafu, Obrikom, Oben gas pipeline (OB3) East-West Interconnector are under construction while the NOPL from Rumuji to Imo River has been completed, he added.

    Terraz also noted some significant challenges in the gas subsector such as inadequate infrastructure along the value chain, insufficient pipeline work and increasing vandalism of existing ones, constrained power generation capacity due to inability to dispatch power to the grid even where sometimes gas is available, and upstream joint venture funding shortfalls, which delay projects including gas development and production projects, but this is being addressed in a creative manner by NNPC and JV partners.

    He also said lack of bankable commercial, fiscal and strong regulatory frameworks that stimulate new developments, including absence of PSC gas terms, were major challenge.

    Terraz said that Nigeria was important for Total. We have made major investments in the oil and gas industry over the past decades and this would continue. It is one of the countries we foresee long-term growth.

     

  • Fed Govt to increase gas flaring fine

    The Federal Government is planning to raise the fine paid on flared gas by oil companies in Nigeria and the committee working on the project may submit its report next month, it was learnt.

    A source told The Nation in confidence that a committee set up by the government is working on the appropriate fine that will compel companies to faithfully comply with government’s aspiration for zero gas flaring from all the oil producing fields.

    Oil producing companies in Nigeria currently pay a fine of $3.50 per 1000 standard cubic feet of gas flared, which most of the companies were said to smartly evade. According to the Department of Petroleum Resources (DPR) report, Nigeria loses $4.9 million daily when the quantity of flared gas is computed at the rate of $3.50 per 1000 standard cubic feet. At   that rate, the loss amounts to $1.7885 billion per year, the agency said.

    Although the source didn’t disclose what the new fine will be, he noted that the committee comprised of representatives from the major stakeholders in the gas industry including the petroleum and power ministries and the Nigerian Electricity Regulatory Commission (NERC), among others. The source said that the committee will recommend enough penalty regime that will compel oil firms to commit to utilisation of associated gas that is being flared. The report will be out next month, the source added.

    The source said that the decision to increase the fine became imperative because of gap in gas supply and demand. Despite the huge gas resource in the country, we don’t have enough gas to power electricity generation companies, which is grave setback to economic and industrial development, he said. Besides, he said that the country flares more gas than it utilises, which is not complimentary.

    He said the situation is worsened by the fact that Nigeria’s source of power supply is predominantly thermal, which accounts for over 70 per cent of the total energy supply. He said that Power Ministry and NERC were represented in the committee because of Federal Government interest and desire to provide stable power supply.

    An estimated 1.4 billion cubic feet of gas is flared per day, and this occurs through the year. Last year, the House Committee on Gas Resources during the presentation of its report on a Bill for an Act to Amend the Associated Gas Re-injection Act No. 99 of 1979 Cap. A25, Laws of the Federation of Nigeria, put the nation’s loss to gas flaring at $2.5 billion yearly.

    Although the government increased penalty for gas flaring from N10 to $3.5 per 1000 standard cubic, the passage of the Petroleum Industry Bill (PIB) would fast-track the achievement of government’s aspiration to fully utilise flared gas, and reduce or eliminate environmental pollution caused by gas flaring.  “If the PIB is passed, it will put into effect modern petroleum legal framework and align operation of the Nigerian gas sector to international best practices and also enhance transparency in the sector,” the source said.

  • Nigeria loses N31.8b to gas flaring

    Nigeria loses N31.8b to gas flaring

    The Federal Government  lost N31.8billion through gas flaring in the month of February this year alone, the Social Development Integrated Centre (Social Action), a non-governmental organisation (NGO),  has said.

    Its Communications Officer, Lillian Akhigbe,  in a statement issued in Port Harcourt yesterday, described gas flaring as the bane of the nation’s gas sector

    She lamented that very little has been achieved to stimulate growth in the sector since Nigerian Gas Master Plan  (NGMP) was approved in 2008.

    According to her, the NGMP was designed to boost the gas sector in order to attain a full market-driven status which regrettably had not been acheived.

    She also lamented that the country had neither experienced a long term energy security nor enjoyed comparative advantage in the high-value gas export market, adding that it is persistent gas-flaring, mainly in the oil and gas producing communities of the Niger Delta region, that had become the order of the day.

    Akhigbe said: “Statistics indicate that Nigeria has about 179 trillion cubic feet of proven gas reserves, yet it lost $198.775 million (about N31.8 billion) to gas flaring in the month of February, 2014.

    “The NNPC data further revealed that the amount of gas flared was 50.098 billion Standard Cubic Feet (SCF), which is equivalent to 23.2 per cent of the total gas produced in the period, 215.93 billion SCF.

    “The abundant gas resources have regrettably spelt doom rather than boom for the people whose environment is perpetually devastated by incessant emission of greenhouse gases into the atmosphere.

    “Gas flaring in Nigeria dates back to 1956, when oil was first discovered in the country and as oil production increased, so did gas production, of which the gas is often regarded as a waste product and disposed into the atmosphere.”

    While fingering independent oil companies, marginal field operators, production sharing companies and joint venture operators for being involved in gas flaring to varying degrees, Akhigbe also said government has not adequately checkmated these firms.

    “So far, government’s efforts at curbing the menace of gas flaring have been feeble and grossly inadequate, as Nigeria remains one of the largest gas-flaring countries in the world,” she said, adding that the last National Conference recommended in its final report that gas-flaring should be criminalised and offenders made to pay the commercial value of the flared gas. The conference also recommended that communities prone to gas flaring should be paid compensation for its devastating effects on health, safety and environment.

  • How to stop gas flaring, by NLNG

    How to stop gas flaring, by NLNG

    For Nigeria to eliminate gas flaring and harness meaningful growth in the sector, the government must put in place adequate security for assets and personnel. It must also enforce operational best practices.

    The Senior Business Strategy and Performance Analyst, Nigeria Liquefied and Natural Gas Limited, Ezekiel Adesina, stated this in Lagos.

    He said there was also need for new partnerships in gas flaring reduction initiatives and commitment by the government to investment.

    He noted that technology is a vital tool in monetising stranded gas and reducing flaring.

    The country he said would require partnership from foreign investors and also employ public private partnership (PPP) initiative to achieve both technical capability and financial support for zero flaring.

    He said that in the year 2000, gas flaring was 38 per cent in terms of volume while in 2012, it was 11 per cent, which showed that Nigeria has taken off 27 per cent of stranded gas that had been put into utilisation. He said that within the period, a lot of improvement had been made in reducing gas flaring in the country.

    He also noted that if the right regulatory framework and fiscal policies are put in place, Nigeria would have zero flaring in the next couple of years.

    Other factors to be considered, he said, include the issue of viability and commerciality of the gas as well as unbundling the value chain in the sector. This, he said would give room for many players to come into the sector. It would also help to ensure that the stranded gas can be captured and commercialised, he added.

    “I don’t need to own a gas firm to do gas business. If we unbundle the gas sector it would give room for more people to come in the value chain,” he said, adding that a lot of gas related projects are underway both for domestic and export.