Nigeria on gas flaring: Time is almost up

Nigeria is about to finish drafting its new energy bill and expects to have this implemented by year end.  The bill intends to put a stop to gas flaring, fining those who fail to comply. Hopefully, it does not curtail the flow of oil investment into the country.

Next to Russia, Nigeria is one of the leading countries engaged in gas flaring activity.  While the process is part of oil production for most facilities and likewise a safety mechanism that prevents pressure build-up, Nigeria is committed to curb flaring within the year.

The draft indicates that immediately at the close of 2012, there shall be no more flaring or venting activity in Nigeria. However, it will only allow flaring under special circumstances that may warrant it. Penalties shall be imposed for non-compliance.

In January alone, the country burned an estimated 30 billion cubic ft. of natural gas. This volume is accounted for by oil giants ExxonMobil, Chevron, and Shell who have been the subject of complaints by environmentalists. Some oil firms, however, may consider investing in oil production facilities designed to capture released gas on the condition that there is a ready market for it.

Residents within Niger Delta, the country’s energy capital, have long been protesting the rampant flaring.

On a larger scale, flaring has caused the emission of 360 million MT of hazardous carbon dioxide into the earth’s atmosphere according to World Bank.  These emissions are comparable to those given off by close to 70 million vehicles.

Many have noted that targeted date is not workable. Half of the year is almost over and passage of the bill is still far from being completed.

Oil firms also argue that it’s useless to capture gas (in lieu of burning) if there is no demand for it. While it is true that Nigeria can use it for producing electricity, its energy sector is not geared for it.

Currently, Nigeria’s energy sector is incapable of distributing gas to its users; therefore the country is welcoming firms willing to invest in oil or power distribution systems that could benefit both household and industrial consumers.

Still, concerned groups strongly oppose flaring and want the practice to end at the soonest time possible. They suggest a shutdown of oil facilities that cannot capture emitted gas and convert it to reusable energy.

But a shutdown would put the country in a precarious situation, especially since oil revenues account for more than 90 percent of the country’s total revenues.

Oil firms say that the only way flaring can be eased at the moment is to slow down oil production – certainly an unwelcome alternative in the eyes of state officials.