Oil firms lose N341bn to gas flaring in 12 weeks
Nigeria reportedly lost N340.87 billion to gas flaring in the first quarter of 2024, as oil and gas firms operating in the country’s oil and gas sector flared 83.9 billion standard cubic feet (BSCF) of gas in three months (January and March 2024), according to latest data released by the National Oil Spill Detection and Response Agency (NOSDRA).
In its report for the period, NOSDRA noted that the amount lost to gas flaring was 10 percent higher than the $266.9 million, about N309.871 billion, lost in 2023.
According to the environmental watchdog, the volume of gas flared in the first quarter of 2024 emitted 4.5 million tonnes of carbon dioxide into the atmosphere and was capable of generating 8,400 gigawatts hour of electricity, while the offending companies were liable for the payment of fines totalling $167.7 million, an equivalent of N194.699 billion.
In comparison, NOSDRA noted that between January and March 2023, the oil firms flared 76.3 billion SCF of gas, which was valued at $266.9 million (N309.871 billion); was capable of generating 7,600 gigawatts-hour (GwH)of electricity; contributed 4.1 million tonnes of carbon dioxide emission, with the firms liable for penalties of $152.5 million, an equivalent of N177.053 billion.
This was even as power generation is expected to increase by 500 megawatts (MW) in the second quarter of 2024, driven by new power plants and rehabilitated facilities.
Specifically, thermal power generation is expected to remain dominant, but renewable energy sources like solar and wind are expected to gain traction; while transmission and distribution constraints are expected to persist, affecting power availability and reliability.
Furthermore, giving a breakdown of gas flared by production segment, the environmental regulatory agency stated that oil and gas firms operating in the country’s onshore oil space flared 42.5 billion SCF of gas in the first three months of 2024, accounting for 50.72 percent of total gas flared.
NOSDRA added that the gas flared onshore was valued at $148.9 million, about N172.873 billion, with penalties payable of $85.1 million, an equivalent of N98.8 billion; while it contributed 2.3 million tonnes of carbon dioxide to the atmosphere and had the potential to generate 4,300 GwH of electricity.
In the same period in 2023, companies operating onshore, caused the country a loss of $130 million (N150.93 billion), from the flaring of 37.1 billion SCF of gas, which has power generating potential of 3,700 GwH and contributed two million tonnes of carbon dioxide emissions, while penalties payable by the companies stood at $74.3 million (N86.262 billion).
On the other hand, companies operating offshore flared gas valued at $144.7 million, accounting for 49.28 per cent of total gas flared in the first three months of 2024.
Specifically, the companies flared 41.3 billion SCF of gas; 5.63 percent higher than the 39.1 billion SCF flared in the same period in 2023; while the quantity flared elicited penalties of $82.7 million, carbon dioxide emission of 2.2 million tonnes and had power generation potential of 4,100 GwH.
Comparatively, in the same period in 2023, offshore companies flared 39.1 billion SCF of gas valued at $136.9 million, with power generation potential of 3,900; carbon dioxide emission of 2.1 million tonnes and penalties payable of $78.2 million.
Some of the offending companies, according to NOSDRA include Shell Petroleum, Development Company (SPDC), Nigerian Petroleum Development Company (NPDC), Chevron Nigeria, Mobil Oil, Elf Petroleum Nigeria, Nigeria Agip Oil Company (NAOC), Addax Petroleum, Texaco Overseas (Nigeria), Esso Exploration and Production Nigeria, Allied Energy Resources, Ultramar Petroleum, Atlas Petroleum; Cromwell and South Atlantic Petroleum, among others.
These companies flared gas from Oil Mining Leases (OML) 04, 05, 11, 13, 14, 17, 18, 22, 28, 23, 24, 38, 40, 42, 43, 72, 49, 54, 90, 95, 67, 70, 104, 59, 99, 100, 101, 102 and Oil Prospecting Licences 222, 3.
