Environmentalists task oil firms on 90% reduction in gas flaring by 2015 by SYLVA EMEKA-OKEREKE Energy and environment experts have tasked oil prospecting companies in Nigeria to reduce gas flaring in the country by 90 per cent in 2015 as promised. SYLVA EMEKA-OKEREKE reports. As the year 2015, is drawing to an end, some environment experts have faulted oil prospecting companies in the country on their promise to reduce gas flaring by 90 per cent next year, saying there is no sign in sight to show they would achieve the feat in 2015. Some oil prospecting companies in the country, including Chevron Nigeria Limited (CNL) along with its joint venture, the Nigerian National Petroleum Corporation (NNPC) had severally boasted that, it would reduce oil spillage as well as gas flaring by 90 percent in the next fiscal year, thus drawing mixed reactions from experts in the environment subsector of the nation’s economy. Recently, the Chairman and Managing Director, CNL, Mr. Clay Neff said, his company, Chevron as well as its joint partner is currently investing hugely to achieve the 90 per cent target by the year 2015, noting that oil spillage as well as gas flaring has remained serious impediments to socioeconomic developments of the country, boasting that the problem would soon be over. However, some experts, who spoke to National Mirror, said the promise may be a hollow one as several gas projects need to be executed before the problem of gas flaring would be reduced to the barest minimum, noting that some of these projects are not yet executed. ‘‘Some natural gas projects ought to have been completed by now as 2015 is around the corner’’, they noted. An environmentalist, Adeyemi Adeoye said before they could achieve 90 percent gas flaring reductions, some gas-gathering projects ought to have been executed in order to gather an additional percent of associated gas by 2015, saying these projects are being delayed. He also blamed government for not being able to achieve total gas flaring reductions in the country. However, a stakeholder in the energy sector, Kelvin Onwuka faulted Adeoye, saying the 90 percent reduction is feasible, especially now that domestic gas demands is growing due to global energy crisis. He said gas reduction would be achieved before the end of 2015 as promised by some oil prospecting companies in Nigeria. He noted that public and private gas power plants are ongoing to encourage domestic gas supply in the country, adding that currently, the international gas marketing is facing lots of challenging. ‘‘I am sure, they will achieve the 90 percent gas reduction even before 2015 due to the prevailing global gas challenges. Both the public and public sectors are pursuing internal gas consumptions. Presently, the domestic gas demand is very high in the country. So, there are lots of gas projects going on in the country’’, he stated. Investigation by National Mirror reveals that, already the CNL has started some of its gas projects and some of them include Escravos Gas Plant (EGP) project, Escravos Gas-to-Liquid (EGTL) project and Sonam Field Development project. Other projects, according to the CNL include West African Gas Pipeline project, Ohaji South field project and Agura independent power plant project among other ongoing projects. Another source from the oil sector, who pleaded for anonymity said, unless these gas projects are completed, the dream of reducing flaring would be a tall dream, accusing governments of being part of the scam to reduce the flaring. The gas projects, the source said would help to harness gas for domestic use as well as exports, if fully executed/ According to him, the promise by oil companies appears to be an empty one, considering the same promises in the past, where they said they would eliminate the problem, but to no avail. The source recalled that some of the oil prospecting firms made the same promise in 2008, 2010 and now 2015, saying Nigerians are tired of such hollow promises from the oil firms, who are making fortunes from the country without giving back to the system. Some experts have also noted that, the eradication of gas flaring as well as other environmental hazards would actually reduce the devastating effects of climatic change ravaging the socio-economic status and health of the world. A source close to CNL also told National Mirror that between 2008 and 2013, Chevron was able to reduce the flaring of associated gas (AG) from its oil fields by 60 per cent, expecting to reduce it more by over 90 percent by the end of next year. The source said the environmental pollution; caused by oil spillage would also be a thing of the past in the country. Environmental pollution, he explained is the introduction of particulates, biological molecules as well as other harmful materials into the earth’s atmosphere, possibly causing disease, death as well as damaging other living organisms such as food crops and eco-system. ’’Atmosphere is a complex natural gaseous system that is essential to support life on planet earth’’, he said. Also, another source said, stratospheric ozone depletion due to air pollution has been recognized as a threat to human health as well as the earth’s ecosystems, just as he listed indoor air pollution and urban air quality as world’s worst toxic pollution problems in 2008. The source also blamed gas flaring on bad leadership, noting that, if Nigeria has had good leadership in the past, gas flaring would have been a forgotten issue. He however suggested different ways to end the flaring while building supports for renewable energy enterprises in the country, noting that the only administration that would have stopped gas flaring was the regime of Murtala Mohammed, if it had not been cut short. Since then, according to him, other administrations have not shown enough sincere commitment to end gas flaring, adding that they are only paying lip service to the problem. “If the National Assembly is serious in ending gas flaring, they would have legislated on the issue”, a source affirmed while lauding the National Assembly under late President Musa Yar’Adua for passing gas flaring bill, aimed at reducing or eliminating the problem, as many Nigerians are worried whether subsequent administrations would muster the political will to implement such bill. “If we look at it properly, we had tapped into gas resources. Instead of flaring them; we would have created a lot of jobs and stopped the uprisings in Niger Delta.”, the source added. The source noted that to end gas flaring in the country and promoting associated gas utilization and renewable energy enterprise, there must be an urgent need to address the global climate change while providing succor for local communities that had lived with the consequences of air and soil pollutions for decades. “Despite an avalanche of anti-gas flaring legislation, policy statements by government officials and commitments made by oil companies to end gas flaring, the Nigerian government has failed to compel oil prospecting companies to comply with court ruling that declared gas flaring illegal and gross violation of human rights.”, he said. Continuing, the source said, “Gas flaring in Nigeria, which is one of the major sources of greenhouse emissions on planet, is making the country the single largest contributor in Africa to climate change, which in turn, is presently threatening our environment, especially the low lying communities in Nigeria and riverside communities in the Niger Delta. Communities in the northern Nigeria are suffering the impact of climate change in the form of desertification and draught.” According to him, options available to Shell and other multinational oil companies, but not considered included processing the associated gas to generate energy for Nigerian communities or re-injecting the same underground. “But these options could have meant some expenses for Shell because providing energy for Nigerian communities was not an option in their books. The bulk of associated gas has not been used to address the needed energy production and contribute to addressing poverty, infrastructural development and industrial capacity in Nigeria. Investigation by National Mirror reveals that despite the growing domestic gas demands in the country, oil prospecting firms in the first half of 2014 , flared a quantum of natural gas capable of generating over 100,000 megawatts of electricity. The Nigerian National Petroleum Corporation (NNPC) in its data released recently said about 198 billion standard cubic feet of natural gas was flared from January to June 2014. The companies, including international and indigenous oil players, burnt 43.7 billion scf in January, which is 19.17 percent of production; 50.1 billion scf in February, about 23.20 percent of production and 38.3 billion scf in March, which is 17.77 percent of output. Also, in April, 22.3 billion scf of gas was flared, 19.7 billion scf in May and 23bn scf was wasted in June. According to an industry analysts, the quantity of gas flared in six months could as well, generate over 100,000mw of electricity far more than the current 4,000mw of electric generation capacity Nigeria is Africa’s top oil producer and largest holder of natural gas reserves on the continent with the world’s record as the ninth biggest gas reserves with 187 trillion cubic feet of proven gas reserves and 600 Tcf of unproven gas reserves. But low investment in gas infrastructure over the years has continued to hamper the harnessing of the huge natural gas reserves in the country for domestic consumption, particularly for power generation. The International Energy Agency in its special report Africa Energy Outlook, released recently, noted that Nigeria’s Gas Master Plan detailed the aim to increase domestic supply and to bring in new pricing and policy regulations as well as providing a blueprint for gas infrastructure. The strategy was to anchor gas supply around “gas to power” in the immediate term while also developing a broader agenda for gas to support industrialization and provide gas for export. It further noted that a critical uncertainty for Nigeria’s gas supply outlook was its ability to stimulate significant production of non-associated gas. “Huge resources exist, sufficient to cover both domestic demand and exports. Production of non-associated gas increases in our projection period, but it is gradual. Exploiting this resource requires a change in focus by the upstream sector and, importantly, the government to establish a framework to incentivize the necessary large-scale capital investment.” This will require a stable, attractive investment environment generally and the development of a bankable commercial structure in Nigeria’s gas sector which includes price reforms, improvements in regulatory arrangements, a redefinition of the role of public companies in the gas sector and an alternative to the current Nigerian National Petroleum Corporation joint venture financing model, the IEA said. Shell Petroleum Development Company had recently said that joint venture funding challenges had resulted in delays to some gas-gathering projects, adding that two of these projects, which were expected to gather an additional 35 percent of associated gas by 2014-15, are likely to be delayed. The oil major, in a briefing note, said it reduced flaring volume from its facilities by about 75 per cent between 2003 and 2012 and flaring intensity (the amount of gas flared per barrel of oil produced) by around 60 per cent over the same period. The delay in building the seventh train has cost Nigeria $2.5bn per year due to revenue from LNG export, as well as the opportunity to further reduce gas flared from oil fields in the Niger Delta, according to Platts. The Nigeria LNG said it was already losing global market share due to the delay in expanding the plant’s output from 22 million metric tons per annum to 30mpta. The Managing Director, NLNG, Mr. Babs Omotowa was quoted by Platts to have said, the company was concerned that the non-passage of the Petroleum Industry Bill could hinder expansion at the six-train LNG plant, despite having already signed agreements with potential buyers in Japan, China, India and Malaysia. “The long deliberations on the passage of the PIB have put much of the investments in oil and gas on hold because of a lack of clarity around the policy direction of the government,” Omotowa said. “This development may impact on gas supplies to feed additional trains,” he added. Industry analysts and stakeholders have stressed that the vast gas reserves in the country can underpin economic growth and diversification to Nigeria through more power generation, more gasbased industrial activities such as fertilizer plants to boost agriculture, petrochemical industries and also high-value exports. “Passage of the Petroleum Industry Bill is strongly supported as it will ensure the proper regulation and administration of the petroleum industry towards effective and efficient production and supply of petroleum resources including natural gas,” the chairman and chief executive officer of the Nigerian Electricity Regulatory Commission, Dr. Sam Amadi, said at a recent event.
Posted on: Tue, 30 Dec 2014 21:50:16 +0000
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