The Nigerian National Petroleum Corporation (NNPC) fixed 2020 deadline to put a stop to gas flaring from oil fields and also review upwards the penalty for every 1000 standard cubic feet (scf) of flared gas.
Group Managing Director of NNPC, Dr. Maikanti Baru, announced these measures during a panel session organised by the Petroleum Technology Association of Nigeria (PETAN) at the ongoing 50th Offshore Technology Conference (OTC), in Houston, Texas, United States.
Dr. Baru insisted that gas should create value, increase the country’s gross domestic product (GDP) and create jobs for Nigerians as it is in other oil producing countries.
Baru explained that the new deadline and the fine regime, became imperative to align Nigeria’s oil production with global standards.
He said: “Natural gas has the capacity to transform an economy. We have seen successful examples all over the world. Qatar has the world’s highest GDP per capita with its growth anchored on natural gas. Trinidad and Tobago saw transformational changes in its GDP and employment rate as it exploited its modest natural gas resources.
“ Saudi Arabia apart from being the world’s largest oil producer, has positioned itself as the world’s hub for petrochemicals, creating significant job opportunities and enabling industrialisation of the country. Russia also leveraged its enormous gas resources, transformed its economy and entrenched its global relevance based on the same. Natural gas can do the same for Nigeria.”
The NNPC chief also unveiled a three-point smart strategy aimed at ending gas flaring in the nation’s oil and gas industry.
Speaking on: “Nigeria’s Gas Flare Commercialisation, Prospects & Opportunities,” Baru explained that in the last decade, gas flaring had reduced significantly from 25 per cent to 10 per cent.
According to him, the multi-pronged approach adopted by the NNPC would ensure a sustainable solution to the historical problem of flaring, thereby turning waste into wealth.
The three-point strategy include ensuring non-submission of Field Development Plans (FDPs) to the Industry Regulator – the Department Petroleum Resources (DPR), without a viable and executable gas utilisation plan, a move aimed at ensuring no new gas flare in current and future projects.
Baru at the 2018 Oloibiri Lecture Series and Energy Forum (OLEF) organised by the Society of Petroleum Engineers (SPE) said Nigeria is currently losing N868 million daily to gas flare, adding that oil and gas firms operating in the country are currently flaring 700 million scf/pd.
The other two strategies, Baru added, were a steady reduction of existing flares through a combination of targeted policy interventions in the Gas Master-plan as well as the re-invigoration of the flare penalty through the 2016 Nigeria Gas Flare Commercialisation Programme (NGFCP) and through legislation that bans gas flaring via the Flare Gas (Prevention of Waste and Pollution) Regulations 2018.
This development, Baru added, would not only see Nigeria dropping from being the second highest gas flaring nation in the world to seventh, it would also signify a major milestone in its gas commercialisation prospects.
“Total flares have significantly reduced to current levels of about 800mmscfd and in the next 1-2 years we would have completely ensured zero routine flares from all the gas producers,” the GMD stated.