How to stop the burning chimneys in the Niger Delta

Mar 21, 2008 01:00 AM

by Ben Adoga

The many questions that agitated the minds of Nigerians on gas flaring in the oil and gas industry since 1958 before the relevant committees of the Senate embarked on the investigation of change in flare-out dead line were:
Why the incessant change in dates or deadlines for gas flare-out in Nigeria?
Why has the Nigerian government allowed so much wastage of funds and resources through gas flaring?
Why have the International Oil Companies (IOCs) and the federal government of Nigeria not been able to convert associated gas for domestic consumption?
And when is it feasible to have zero flares in the oil and gas industry?
These were the major questions asked by the three committees of the Senate; The Committee on Gas, Environment and Ecology and Petroleum-Upstream when they were called for investigation recently.

Gas flaring started in Nigeria with oil production as associated gas is a natural by-product of oil production. The refineries in the country were designed to flare gas while crude oil is refined.
Nigerians were not conscious of the damage to lives and the environment as they enjoyed the boom from oil. Lately, it became necessary to talk about the environment. In year 2000, a deadline of 2004 was fixed for stoppage of gas flaring in Nigeria. Even as a terminal year was arrived at, no conscious efforts were made towards realising the target. By 2007, a new date was fixed for total flare-out. It was said that on January 1, 2008, all oil and gas companies would stop gas flaring in the country. By January 1, 2008, a new deadline was rumoured and the IOCs quickly accepted the new rumoured date of December 31, 2008.

Senator Osita Izunaso, Senate Committee Chairman on Gas, one of the conveners of the meeting wanted to know the circumstances surrounding the incessant shift of deadline of gas flare-out. Gas as a commodity is highly invaluable in domestic consumption and in industries to power their machines in the absence of the national grid whose problem has become hydra headed. The majority of Nigerians depend on fire wood and charcoal got from burning trees for domestic cooking gas that could have been converted for such purposes, but are flared.
It is said that Nigeria flares 2.5 mm cf of gas per day. The gains of converting this volume of gas to domestic and industrial use can only be imagined. Nigeria is ranked 7th in gas flaring in the world with Russia taking the lead while countries like Saudi Arabia achieved zero flaring a long time ago.

While the federal law makers were looking for ways of compelling the International Oil Companies (IOCs) to stop gas flaring, minister of state for energy (Gas), Emmanuel Odusina, could not agree less, but told the panel that stopping gas flaring was capital intensive, and that Nigeria's gas was not localised, so it would need a robust infrastructural outlay to harness the gas for other uses.
He also noted that while the NNPC, DPR and the ministry agreed on the terminal date of 2008, the IOCs had proposed 2015. The minister agreed that if a proper deadline is arrived at, an implementation time table would be given to the oil companies to comply with for the realisation of the goal.

Director of Department of Petroleum Resources, DPR, Anthony Chukwueke said while oil could be kept in tankers and even moved around easily, gas needed to be preserved or piped to the end users, and that these processes add to the cost of the product. He said the department had tried to discourage flaring over the years, but that it had not been effective. A price of N 50,000 for a cubic foot of flared gas was imposed; the amount was increased to $ 10. While DPR was charging this meagre amount, the actual value of gas (flared) per cf was $ 8, according to the DPR Director.
In the absence of infrastructure to convert associated gas into usable products, it was more profitable to flare and pay the fire than worry themselves with putting in place infrastructure.

The director also noted that the infrastructure needed would cost the government and the IOCs up to $ 20 mm to establish. He equally disclosed that even the federal government has not put down their part of the fund to put establish infrastructure. For the oil companies, he said, it is strictly business and as long as the federal government is not committed to enforcing a deadline and establish infrastructure to convert associated gas, the situation will not change.
However, the Group Managing Director, GMD, of Nigeria National Petroleum Company, NNPC Engr. Abubakar Lawal Yar'Adua disclosed that if the infrastructure is established by 2009, 98 % flare-out could be achieved, however, that the real issue is funding and infrastructure. He said the federal government had given the NNPC the go ahead to source for funds towards putting the infrastructure in place. The federal government will not go it alone; they will collaborate with the IOCs.

Meanwhile, as the controversy in deadlines lingers, Lawrence Ajibade who represented the environment and housing minister, made it clear that all the dates canvassed were wrong as it was his ministry that called a stakeholders- including oil companies meeting in the Abuja Sheraton Hotel on 9th and 10th August 2004, where all concerned agreed to the deadline of July 31st, 2008. The Nigerian government through the ministry of environment and housing had fixed the terminal date for flares in the country that is July 31st, 2008.
About few months from now, it would have been incumbent on all concerned, especially the IOCs to respect the date, more so when they were part and parcel of the decision to have the flare deadline. Though, the pronouncement was made, nothing was done to make it enforceable. It was not properly gazetted nor communicated in any official manner.

The legislature was not carried out with major stakeholders on this matter. They could have passed a resolution which, in the absence of all other legal instruments, would become enforceable.
From the look of things, not even the Nigerian government meant what they said. They were not prepared for flare-out as the GMD of NNPC has stated that they were yet to establish infrastructure, just like the Nigerian government was yet to provide her counterpart funding towards the flare-out infrastructure. Though Engr. Yar'Adua has disclosed that the sum of $ 5 bn has been raised from the capital market for this purpose, he did not say if the said amount was all the federal government needed to provide and what percentage of the total amount that was.

All said and done, what is important is the infrastructure. When it's provided, the citizenry will benefit tremendously, especially with regards to domestic consumption, industrial utilisation to put industries back on line and it will also save the environment.
The other side of the coin is the issue of the environment which is even far more important than the money the Nigerian government is losing through the flares. Flaring the gas into the atmosphere destroys the environment. The ozone layer depletion which is responsible for global warming and climate change with its dangerous consequences on human life, agriculture, sea level etc. will be minimised if gas flaring is stopped.

Senate Committee Chairman on Environment and Ecology, Senator Grace Bent did not mince words in urging the immediate stoppage of flares. She said the Nigerian government would not tolerate flares after the agreed deadline and that the government would not hesitate to shut down wells that are hazardous to lives and the environment, not minding the fines the oil and gas companies pay for flaring.
The Niger Delta environment, to say the least, has been exposed to dangerous consequences of flaring since 1958. The once lush forest is almost completely gone due to acid rain, corrugated sheets used for roofing have given way, the one time area known for its fish now depend on imported frozen fish and spillage has either killed or poisoned the aquatic life of the area. Crop yield has reduced to the barest minimum as the land can no longer sustain cultivation after several years of environmental degradation and spillage which in most times are not reclaimed, leaving the hazardous materials to equally pollute the water which the rural populace depend on for drinking.

All said and done, a quick flare-out is the desire of all stakeholders.

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