FG begins gas flare reduction with award of 45 licences in June
The Federal Government will next month award licences under the Nigerian Gas Flare Commercialization Programme (NGFCP) to qualified bidders as part of efforts to end gas flaring in the country and expand her gas footprint.
Minister of State for Petroleum Resources, Timipre Sylva, who disclosed this in Abuja, blamed the delay of the scheme on the marginal bid round, adding that with the licencing round off the table, the government would focus on the NGFCP and see to its completion before the end of June.
The World Bank had earlier in the month, said Russia, Iraq, Iran, the United States, Algeria, Venezuela and Nigeria remained the top seven gas flaring countries in the last nine years.
The Bretton Woods institution said the seven countries produce 40 per cent of the world’s oil each year but account for roughly two-thirds, which is 65 per cent of global gas flaring.
This development negates the Paris Climate Change Agreement, where Nigeria is a signatory to the Global Gas Flaring Partnership (GGFR) principles for global flare-out by 2030. The government had announced to end the flare in 2020 but failed to meet the commitment.
After approval by the Federal Executive Council (FEC), the programme was launched by the ministry of petroleum resources on December 13, 2016, but remained elusive over four years after the programme was launched.
Last year, the Department of Petroleum Resources (DPR) said 45 out of 178 gas flaring sites in the country were identified for award to successful bidders.
The Federal government had shortlisted 200 bidders from 800 bids to compete for the 45 flare sites, noting that other flare sites were coming on board.
Although Sylva said gas flaring has reduced to about 8 per cent in the country, approximately 90.9 billion cubic feet of natural gas was lost to gas flaring in the first five months of 2020. The loss was valued at $230 million.
Sylva insisted that government is however not interested in just ending the flares but ensuring that it benefits the people as well as the government.
“That is actually the challenge, a lot of flares are down already. Now what we are trying to do is to ensure that the flares become commercialized, that’s why it’s called the gas flare commercialization programme.
“It is not enough to stop gas flaring. What we want to achieve is to commercialize those flares, so that people can benefit, Nigeria government can also benefit from that flare,” the minister said.
Disclosing that a lot of the gas is used in Bonny LNG and some of the gas is reinjected, Sylva said: “We want to get to that point where it is actually commercialized and that process of commercializing the gas is going to be completed very soon. In fact, I am sure that in the next one month. That process will be completed.”