Nigeria’s House of Representatives insists on 2008 gas flaring deadline

Jun 11, 2005 02:00 AM

The House of Representative directed the Nigerian National Petroleum Corporation (NNPC) and oil producing companies to ensure that the 2008 deadline issued by the Federal Government for zero gas flare target is complied with.
The directive to the NNPC and its joint venture partners on the gas flaring deadline, was one of the two mandates the House handed down to the corporation as its role in meeting the economic reform strategy of the present administration.

Speaking at the launch of the second phase of the NNPC Transformation Project in Abuja, the Deputy Speaker of the House of Representatives, Chief Austin Opara, said both the Executive and the National Assembly had taken major steps to encourage utilization and monetisation of the nation's huge gas resources and therefore believed the gas flare out deadline is achievable.
"We know that the government policy is zero flare, and the target is 2008. Unfortunately Mr GMD (of the NNPC), we read in the papers recently that one of the key players in the sector believes that 2008 is not achievable. We sincerely want to put this before you that 2008 should be the target and we believe that it can be achieved," he added.

According to the Deputy Speaker, the passage of the power sector reform bill by the National Assembly and its subsequent assent by President Olusegun Obasanjo last March, was an important step towards increased gas monetisation and utilization.
He however, disclosed that the bill on National Gas Policy, expected to guide investment, production and downstream gas operations in the country, was yet to be submitted to the National Assembly. Opara said the bill sent to the Assembly was that of the $ 590 mm West African Gas Pipeline (WAGP) project.

Shell Petroleum Development Company (SPDC), Nigeria's biggest oil and gas producer, was the first to alert the public recently about its inability to end gas flaring from the fields by the 2008 deadline.
The oil company had cited funding problems to complete projects aimed at gathering the flared gas from oil fields as contributing largely to the postponement. It said the contribution by the NNPC to cover its 55 % equity in the joint venture, recorded a shortfall of $ 4 bn over an eight-year period.

Special Adviser on Petroleum and Energy, Dr Edmund Daukoru had also hinted that the government might not really hold the oil firms tight to the 2008 deadline, as the date was really to guide the oil companies in putting in place the various gas utilization projects geared towards the zero flare target.
Opara also said the second key transformation demanded from the NNPC and operators, is the improvement in participation of Nigerians in activities in the oil and gas industry, referred to as National Content.

Opara who stated that the economic reform process in the country was irreversible, and that the progress in the two areas (gas utilization and local content) would have a significant impact on the growth of the economy through the identification of the much sought after linkages of petroleum sector with other sectors of the economy.
"The National Assembly has been at the fore-front of enabling this through speedy consideration and passage of bills which are the vehicle for the realization of transformation objectives. Bills which are now Acts, include the privatisation act, power reform, labour reforms, monetisation, infrastructure concessioning, etc," he added.

Also speaking on the NNPC transformation project, the Corporation's Group Managing Director, Engr. Funsho Kupolokun, said since the launch of the first phase of the project last year, the NNPC had recorded improvement in its operational efficiency while key business units including the Nigerian Petroleum Development Company (NPDC) and the National Petroleum Investment Management Services (NAPIMS) have been strengthened to meet the current demands.
Kupolokun said while the NNPC staff strength has been trimmed from 17,000 to 10,000 for efficiency, he added that the Corporation also only recently recruited 700 fresh graduates.

He added that NNPC, along with other major operating companies were faced with the challenge of manpower problem in the gas sector.
"We are even now trying to fill NNPC quota in the Olokola LNG project. The NNPC and its partners now have to embark on recruitment drive to fill space for the various gas projects because of the boom in gas," he said. Kupolokun said the transformation project tagged "Project PACE" was launched to ensure that NNPC operate on commercial basis, be able to compete efficiently and effectively with other national oil companies like Petrobras of Brazil and Petronas of Malaysia. He added that the project was in consonance with the Federal Government economic reform package.

Source: This Day
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