- By Akpandem James
For decades, the sight of roaring flames lighting up the night sky in Nigeria’s Niger Delta has been both a symbol of oil wealth and a reminder of environmental neglect. Gas flaring, long treated as an unavoidable by-product of crude oil production, has inflicted deep scars on host communities, degraded ecosystems, endangered public health and strained relations between oil producers and their hosts. Over time, these tensions contributed significantly to operational disruptions, community unrest and the eventual decision by some international oil companies to divest from onshore oil production in the region.
At the heart of this long-standing conflict lies environmental degradation, with gas flaring as one of its most visible and damaging manifestations. Beyond the obvious pollution of air, soil and water, flaring has been linked to respiratory illnesses, acid rain and heightened safety risks for communities living near oil facilities. For Nigeria, whose economy depends heavily on hydrocarbon revenues for foreign exchange earnings, the consequences extended beyond the Niger Delta, affecting national output, investor confidence and energy security.
These challenges formed part of the critical concerns addressed by the Petroleum Industry Act (PIA) 2021, a landmark reform that redefined the regulatory and commercial framework of Nigeria’s petroleum sector.
Sections 104 to 108 of the Act introduced a comprehensive regime for prohibiting, penalising, measuring, managing and ultimately eliminating the flaring of natural gas during petroleum operations. This marked a decisive break from the Associated Gas Re-injection Act (AGRA) of 1979, which had permitted routine flaring with ministerial approval once operators submitted gas re-injection plans.
In practice, the old regime inadvertently encouraged flaring. Penalties for non-compliance were relatively low and often cheaper for operators than investing in gas utilisation infrastructure. The result was decades of routine flaring, with enormous environmental costs and lost economic value. The PIA reversed this logic by making flaring increasingly unattractive while creating clear incentives for gas capture and utilisation. It also streamlined milestone approvals for gas flare elimination facilities, ranging from concept design and front-end engineering design to detailed engineering approvals and final permits to operate, thus providing regulatory clarity and predictability for investors.
With the coming into effect of the PIA in August 2021 and the subsequent inauguration of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in October 2021, Nigeria’s foremost upstream regulator, decisive steps were taken to confront what had become an Achilles heel of the petroleum sector. Central to this effort were clear regulatory guidelines and the relaunch of the Nigerian Gas Flare Commercialisation Programme (NGFCP) in September 2022.
The NGFCP was conceived as a market-driven solution to a decades-old environmental and economic problem. Its core objective is to transform flare gas from a long-standing liability into a valuable economic asset capable of driving industrial growth, strengthening energy security and significantly improving the sector’s environmental credentials. Rather than viewing flared gas as waste, the programme treats it as feedstock for power generation, LPG, petrochemicals and other gas-based industries.
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According to the commission’s chief executive, Gbenga Komolafe, the ambition is nothing short of transformational. “The target was to end a decades-long challenge and replace it with a wealth-generating, climate-positive opportunity,” he said.
By allocating flare sites to competent third-party developers through a transparent and competitive process, Nigeria has activated what he describes as a globally innovative commercial model—one in which waste is converted into value and environmental challenges give way to investment opportunities.
The scale of the programme is significant. The NGFCP targets 49 flare sites across land, swamp and shallow offshore terrains, with aggregate flare volumes estimated at between 250 and 300 million standard cubic feet of gas per day by 2027. Individual sites range from 0.5 to 30 mmscf/d, offering opportunities for both small modular projects and larger gas utilisation schemes. Supported by the fiscal incentives embedded in the PIA, the programme is expected to attract up to $7.2 billion in investment capital while delivering annual emissions reductions of between six and seven million tonnes of CO₂ equivalent.
Beyond climate benefits, the economic implications are far-reaching. Increased gas supply into the domestic market will deepen in-country value addition, stimulate gas-based industrialisation and reduce reliance on imported fuels. For host communities in the Niger Delta, the programme promises cleaner air, new infrastructure, employment opportunities and enhanced social development. For oil producers, it offers relief from flare penalties, reduced environmental and operational liabilities and improved environmental, social and governance (ESG) performance—an increasingly important factor in global investment decisions.
The NGFCP also aligns fully with Nigeria’s Energy Transition Plan (ETP) and its Nationally Determined Contributions under global climate frameworks. As noted by Komolafe, the programme is not merely a policy initiative but a core pillar in Nigeria’s effort to eliminate routine flaring, reduce greenhouse gas emissions and enhance the country’s credibility in international energy transition commitments.
Progress under the programme has been steady. To date, 28 frontline NGFCP awardees have been issued final permits to access flare gas, marking a critical transition from planning to implementation. The programme itself has been structured in three phases: the bidding process, which began in 2023 and culminated in the announcement of 42 awardees in September of that year; a negotiation phase in 2024 covering technical, commercial and contractual terms, followed by permit issuance in 2025; and a final execution phase, scheduled to commence in 2026, aimed at delivering actual flare-out projects.
This transition was formally underscored on Friday, December 12, when the NUPRC issued Permits to Access Flare Gas (PAFG) under the 2022 NGFCP. Presiding over the ceremony, Komolafe described the event as a milestone achievement for Nigeria’s upstream sector, a strategic inflection point signalling the shift from legacy challenges to market-driven solutions that unlock economic opportunities, strengthen energy security, reduce emissions and improve operational efficiency across the industry.
More importantly, the issuance of permits marked the end of commercial negotiations and the beginning of real project execution. It signalled a fundamental change in how flare gas is perceived, not as waste or an environmental burden, but as a commercially viable resource capable of driving industrial growth and national prosperity. In regulatory terms, it represented a decisive move from policy design and bidding to tangible implementation under the NGFCP.
The achievements recorded so far are notable. The programme has awarded 49 flare sites across three terrains to 42 bidders, attracted an estimated $2 billion in foreign direct investment for gas development projects and placed Nigeria as a pioneer in structured flare gas commercialisation. It has also created a fast track towards fulfilling the presidential mandate of deepening domestic gas utilisation while enhancing local participation in the sector.
Recognising that success depends on effective delivery, the NUPRC has established continuous support mechanisms for permit holders. These include streamlined regulatory approvals, hands-on guidance through a dedicated NGFCP Project Management Office, facilitation of access to financing, including carbon finance in collaboration with development partners, and sustained advocacy for international support.
However, the responsibilities are clearly shared. Producers are obligated to deliver flare gas in line with agreed quantities and quality, ensure accurate metering and transparent reporting, provide safe access to flare sites and align host community engagements with permit holders. Permit holders, on their part, must design, finance, build and operate gas gathering and utilisation facilities to approved technical and safety standards, meet flare-out milestones, maintain robust health, safety and environmental systems, and manage fair relationships with host communities.
Once projects commence, routine gas flaring is expected to cease, except in limited emergency situations expressly permitted by regulation. The ultimate expectation is clear: visible projects on the ground that convert flare stacks into engines of economic value.
If fully implemented, gas flare commercialisation under the NGFCP will stand as one of the most consequential reforms in Nigeria’s upstream petroleum sector. It offers a compelling example of how environmental responsibility can be aligned with economic growth, delivering cleaner air for communities, operational relief for oil firms and sustainable value for the national economy. In extinguishing the flames of routine flaring, Nigeria may well be lighting the path to a more resilient, inclusive and climate-conscious energy future.
•James, Fellow of the Nigerian Guild of Editors is a member, Governing Board of the Nigerian Institute of Journalists, Lagos.
