With an estimated $22b lost to gas flaring in the last nine years despite stringent efforts to rein in the hydra headed monster, experts say the problem may remain intractable unless the federal government muster the right political will, reports Ibrahim Apekhade Yusuf
One ailment that seems to have defied all known antidotes applied for its cure is gas flaring.
Lamentably, the menace of gas flaring is such that has caused the country huge economic losses as well as dealt severe health and environmental crises on its citizens in the past 67 years after the first discovery of oil in Oloibiri, a small community in Ogbia LGA located in the present Bayelsa State.
Dangers of gas flaring
Gas flares are created when oil companies burn off extra gas that escapes as a result of oil drilling.
Gas flaring is a significant contributor to global warming. The World Bank notes that gas flares contribute to climate change through the emission of millions of tons of C02 to the atmosphere. Besides, it wastes a valuable energy resource that could be used to support economic growth and progress.
Flaring releases air pollutants such as carbon monoxide, carbon dioxide, volatile organic compounds, sulphur dioxide, polycyclic aromatic hydrocarbons, and particulate matter in the form of soot.
Perhaps the most horrifying and troubling menace of gas flaring can be explained in the gross damage it does to the health of citizens.
The most vulnerable groups are children in the host communities where oil exploration activities take place, as they are adversely impacted by gas flaring, with many suffering from respiratory diseases, fever, and diarrhea just as they also experience stunted growth, wasting, and underweight issues.
There is also the additional damage to flora and fauna. Toxic pollutants similarly damage the environment, killing off plants and animals, despoiling the soil and water, while impoverishing the host communities.
While lamenting the continuous flaring of gas and illegal crude oil operations in the Niger Delta region recently, an environmental rights activist, Chief (Comrade) Sheriff Mulade said residents are at risk of getting sarcoma cancer.
Disclosing this while delivering a lecture at the OML 42 Youth Forum held at Effurun, Uvwie Local Government Area of Delta State, Mulade who is the Coordinator, Centre for Peace & Environmental Justice (CEPEJ), stated that people are suffering from the disease without their knowledge.
According to him, a specialist is needed to help diagnose the disease.
While emphasising the need to stop gas flaring and illegal oil activities the environmentalist posited that creating awareness on the dangers of the duo to the health of the people will help tackle the disease.
“Our people need to be aware so that they don’t think it’s just one of those common sicknesses. That’s why we are also trying to create some level of awareness so that they can have deep insights,” he said.
Pointing out that most hospitals in the area do not have the capacity to detect and treat the disease, he revealed patients are usually referred to the University of Nigeria Teaching Hospital UNTH), Enugu or the Lagos State University Teaching Hospital for treatment.
A sarcoma is a type of cancer that starts in tissues like bone or muscle. Bone and soft tissue sarcomas are the main types of sarcoma. Soft tissue sarcomas can develop in soft tissues like fat, muscle, nerves, fibrous tissues, blood vessels, or deep skin tissues.
Unmitigated economic losses due to gas flaring
Official records indicate that Nigeria loses about $2.5 billion annually to gas flaring. However, The Nation can authoritatively report that that amount pales into insignificance as it hardly covers other substantial losses along the gas and oil process, extraction, exploration chains.
From available information, Nigeria with 206.53 trillion cubic feet, ranks as the world’s ninth largest reservoir of gas compared to crude oil at 37.05 billion barrels, has been unable to harness the valuable resource for the country’s benefit.
Nigeria has flared over 4.2 billion standard cubic feet of gas, resulting in a revenue loss of more than $14.6 billion from 2012 to 2021.
The country has also incurred an additional penalty of $8.3 billion for this wastage, bringing the total loss to $22.9 billion during the same period.
Confirming this development, the Director of ICT at the Nigerian Oil Spill Detection and Response Agency (NOSDRA), Mrs. Margaret Adeshida, while speaking at a public forum in Abuja recently, stressed the need for proper monetisation of gas flaring in Nigeria.
The NOSDRA 2022 Nigerian Gas Flare Tracker showed that Nigeria lost tonnes of gas, including useful natural gas valued at $790 million, to gas flaring.
Who to blame for gas flaring
Indications are that the Nigerian National Petroleum Company Limited (NNPCL), Shell, ExxonMobil, Chevron, Total and other oil companies operating in the country flared about $3.9 billion (about N3 trillion) worth of gas in the last four years, despite growing environmental concerns and revenue leakages in the nation’s petroleum industry.
Gas flaring is a violation of the Fundamental Right to Life and Dignity of the Human Person as guaranteed under Sections 33 and 34 of the 1999 Constitution of the Federal Republic of Nigeria (as amended) and there is a fine for such violation.
Government imposed a penalty of $2 per million cf for gas flared in 2018, and inaugurated a 12-member Flare-Gas Commercialisation Programme Team in 2022.
However, gas flaring persists because the oil companies, taking advantage of Nigeria’s poor regulatory oversight and pervasive corruption, prefer to pay the meagre fines instead of developing the resource for domestic consumption and export, and as raw material for other industries.
Fines imposed on international oil companies (IOCs) and others for gas wastage were valued at $450 million; but these are considered largely too little, and most has not been paid.
But these fines amount to pittance compared to the enormous revenues lost, analysts have argued.
More troubling is the fact that most of these fines are not paid at the end of the day. A flagship report by the Petroleum Revenue Special Task Force in 2012 found that the companies often do not pay the fines. Rather, the report noted, they pay the old penalty of N10 per 1000 scf flared, and even at that, authorities lack the bite to accurately track what each operator should pay.
Any gains to gas flaring?
In 2022, the government estimated the value of Nigeria’s gas reserves at $803.4 trillion.
Although there has been some reduction in global gas flaring volumes, Nigeria remains one of the top nine countries in gas flaring, but the World Bank’s 2023 Global Gas Flaring Tracker Report revealed that despite reducing it by 20 percent between 2021 and 2022, Nigeria burnt between 5500bcm and 7,550bcm between 2018 and 2022.
It shares the gas flaring profile with Russia, Iraq, Iran, Algeria, Venezuela, the United States, Mexico, and Libya. Together, the nine account for almost three-quarters of global gas-flare.
Although Nigeria’s gas exports improved as a result of the global shortfalls occasioned by the Russia-Ukraine war, the country continues to lag behind when compared with other countries with smaller gas reserves.
Till date, its highest earning from natural gas export in five years was N2.8 trillion for 700,000 tonnes of Liquefied Petroleum Gas in 2022.
Comparatively, Algeria with 159tcf of reserves (the world’s11th largest), exported 19.7 billion tonnes, according to Reuters, Egypt with 77.2tcf, exported 8.0 million tonnes of LNG earning $8.4 billion. Angola, with13.5tcf, exported gas products valued at $1.49 billion.
More losses
Data obtained from Dataphyte revealed that Nigeria generated only 8.0 million megawatts per hour of electricity but wasted a potential 35.4 million MW through gas flaring in 2020.
This is just as the 2022 survey by the National Bureau of Statistics revealed that only 63.8 percent of Nigerian households have access to cooking gas, while the International Centre for Energy, Environment and Development, Abuja, stated that 93,00 Nigerians, mostly women and children, die from inhaling smoke while cooking with firewood.
Rising concerns over gas flaring
Recently the House of Representatives threatened to sanction oil companies engaged in the profligate habit, owing to what they termed the unmitigated economic loss of billions of naira due to gas flaring.
The Speaker of the House of Representatives, Tajudeen Abbas, subsequently inaugurated an Ad hoc Committee to investigate alleged $9.05 billion revenue loss from gas flaring in the last one decade in Nigeria.
Thus, the legislators asked the National Oil Spill Detection and Response Agency to provide details of companies owing outstanding gas flaring violation fines.
The lower chamber therefore impressed on the regulators the need to “strengthen synergy to produce a practical and unified multi-level governance and policy coherence analysis that will stem gas flaring, protect the environment and boost energy supply.”
This is just as experts have suggested a multi-prong approach to dealing with the issue of gas flaring such as preventing flaring by designing systems that do not produce waste gases just as recovered waste gases can be made into products and sold, inject waste gases into oil or gas reservoirs and also find alternative uses for flared gases, such as generating electricity.
In the view of Adewale Semiu, an oil and gas expert, “one of the safest and economical alternatives to gas flaring is to liquefy and store the gases generated as a byproduct of oil and gas well production. After the gases have been purified, oil and gas companies can store liquefied natural gas for domestic use or use on an industrial scale.”
Revenue drive to stem gas flaring
Miffed by the unmitigated financial losses due to gas flaring, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) in collaboration with the Nigeria Upstream Regulatory Commission (NUPRC) and the Nigerian Oil Spill Detection and Response Agency (NOSDRA) have set machinery in motion to turn this into a revenue generation stream by implementing effective gas flaring management strategies.
These disclosures were made during an interactive forum between delegations from RMAFC, NUPRC and NOSDRA recently in Abuja.
Also speaking at the event was Mr. Babajide Fashino, the Director of Economic Regulation and Strategic Planning at NUPRC painted a rosy picture of Nigeria’s gas flaring practices.
He said Nigeria is currently doing well by “managing gas flaring in accordance with global best practices for achieving economic growth and sustainability.
“This commendable feat has been achieved through the implementation of a metering system accompanied by thorough calibration procedures for the meticulous monitoring and recording of all gas management activities,” he said.
As a result of these innovative measures, Babajide Fashino stated that “gas flaring in Nigeria has remarkably reduced from an alarming 40 percent to an impressive seven percent.”
In his remark, the RMAFC Chairman, Mohammed Bello Shehu emphasised the importance of prioritising the gas sector in the nation’s drive to boost revenue generation.
He highlighted the need for regulatory bodies such as NUPRC and NOSDRA to play a significant role in assessing the quality and quantity of gas production, as well as ensuring strict adherence to environmental standards for the benefit of host communities.
In light of this, Mohammed Shehu urged all stakeholders involved in gas economy management, including the revenue monitoring committee of the current administration, to join forces and develop effective strategies.
The goal he noted is to transform flared gas into valuable economic resources, resulting in increased revenue generation that will contribute to the growth of the Federation Account.
These collaborative efforts, he said, will play a crucial role in salvaging the country and maximising the economic potential of gas flaring.
Lack of political will to end gas flaring
Independent checks at official records by The Nation revealed that the federal government has been unable to end gas flaring in the 178 sites since it first set the target in 1979.
The move to extinguish all flares by 1979 (under the Associated Gas Re-injection Act of 1979) failed and by 1984, when it became illegal, was set. Again, this new date failed, and 2004 became the next target and then the Nigeria Gas Master plan of 2008.
By 2016, the federal government again extended the deadline to end gas flaring to 2020.
In 2021, the then Minister of State for Petroleum Timipre Sylva said that the government is now committed to eliminating gas flaring by 2025.
The country, he said, has “actually reduced gas flaring significantly to a very minimal level of eight per cent. If you all recall, last year the ministry of petroleum started what we call the National Gas Expansion Programme and we declared 2020 as the year of gas.
“At the beginning of this year, we declared 2021, the beginning of the gas decade. We believe that with all the programmes we have in place, we are on course to achieve complete elimination of gas flaring by 2025.”
It is however, a matter of conjecture if as a signatory to the World Bank’s Global Gas Flare Reduction Partnership and with the mandate to extinguish all flares by 2030, Nigeria would be able to meet this target.
New agenda for Tinubu to end gas flaring
In the view of experts, strict regulations should be backed by the political will to ensure its full exploitation just as it wants the government to increase the fines and impose harsher penalties on companies flaring gas during crude oil production.
Specifically, Semiu, said among other measures, President Bola Tinubu should prioritise the $2.5 billion project that is expected to transport up to 3.5billion cf of natural gas daily, facilitate access to cooking gas, generate 3,600MW of electricity, and feed the petrochemical plants.
While noting that the extant legislation should be reviewed, he also urged the President and the National Assembly to ensure amendment of the PIA and enforce an end to gas flaring soonest.
