Nigeria loses N12.3trn to gas flares in 40 years

The amount is a rough estimate of the 2.5 billion standard cubic feet (scf) of natural gas reserves put at over $2.5 billion in revenue lost yearly to gas flaring in the country.

Nigeria boasts of the tenth largest reservoir of proven natural gas and produces over 2 million barrels of crude oil per day, which translates to over $17. 2 billion yearly.

In spite of this development, the Federal Government had last week conceded to pressures by multinational oil companies to extend gas flares from January 1 2008 to December 31 2008.

Nigeria is world’s biggest gas flarer as a more recent research showed that if the country harnessed flared gas and put it to use as an alternative energy source, it would solve almost 75 percent of Africa’s energy needs, except South Africa .

The Environmental Rights Action/ Friends of the Earth Nigeria (ERA/FoEN), on Thursday, last week, decried government’s capitulation to the oil companies at whose behest it had extended gas flares-out dealine to December 31, 2008.

Its executive director, Nnimmo Bassey, who spoke to journalists at a press conference on the development, said oil companies had been burning gas for years and polluting the environment and atmosphere, thereby causing degradation of the vegetation and health hazards.

He lamented that the Department for Petroleum Resources (DPR) does not even know the exact amount of gas flared in the country and that oil companies were not ready to end flares because of their unwillingness to invest their profit in developing infrastructure that

Enhance the conversion of flared gas to liquefied natural gas and other sources of energy.

"In Nigeria , flares have been on since the early 1960s in the Niger Delta and offshore where over 100 flare sites still emit the toxic cocktail.

"Gas flaring contributes to reduction in farm yields but with more far-reaching implications on man in form of respiratory illnesses, asthma, blood disorders, cancer, painful breathing and chronic bronchitis, among others," he said.

Bassey explained that Shell said it had the capacity to end flares all over the world in 2008 except in the Niger Delta citing inaccessibility of some of the locations as reasons why flares-out cannot be achieved in Nigeria .

The best way out of the logjam, he noted, would be to stop production in the locations where gas flares cannot be attained, insisting that continued gas flaring was criminal, sinful and the greatest violence in the Niger Delta. "As such it must stop on January 1, 2008," he stressed.

Part of the reasons why the flares must stop, he pointed out is the fact that President Umaru Musa Yar’Adua believes in the rule of law and as such cannot be part of the illegality of gas flaring.

The biggest culprits in the game of gas flaring are Shell Petroleum Development Company (SPDC), ExxonMobil and Chevron. Incidentally, these companies had indicated their readiness to end gas flares at various dates. Shell said it would end flares by 2008, ExxonMobil made a commitment for 2004 while Chevron promised to end flares by 2006 in phases and hinged its attainment on the Escravos Gas Project phases two and three.

But all three companies have reneged on their promises, a development that resulted from lack of political will on the part of government to end the flares.

The first attempt at forcing oil companies to end gas flares dated back to 1969 when the then General Yakubu Gowon’s administration ordered them to deploy facilities that would enable them to comply with government directive. It was shifted to 1979 before the Gowon administration was ousted in 1975.

Again in 1979, the oil corporations failed and the deadline was shifted to 1984 and since then successive governments have shifted the deadline for achieving zero flares at the whims and caprices of the oil companies.

Government had in November 2007 increased the fines for companies that fail to achieve zero flares from N10, 000 to N12, 700 per million standard cubic feet of gas (MSCF) with effect from January 2008

But ERA/FoEN, insists that in spite of the fine, the extension of the deadline to December 31, 2008 as another shift too many, especially as it was coming from a government that believes in the rule of law.