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Gas Flaring And Clean Energy in Oil Producing Communities: AGFAN, Ors Dialogue Way Forward

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By Our Reporter

The Advocacy for Gas Flare Accountability in Nigeria (AGFAN), in a project anchored by Initiative for Community Development (ICD) recently, chatted a new course in Uyo, the capital of Akwa Ibom State to achieve the goal of improving accountability in flared/vented gas volumes and payments, increase liquefied petroleum gas (LPG) utilization by  5,000,000MT by 2023 as well as reduce GHG Emissions and assist to meet Nigeria’s National Determined Contributions to UNFCCC.

In a paper presented by Mrs.  Egondu Esinwoke-Ogbalor, she said that AGFAN Cluster is not weary in its efforts in achieving its goal and that the group wants gas flaring to be an electoral issue for 2023 elections, as new government is warming up to take over political offices.

According to her, “AGFAN Cluster with support from USAID through palladium has been engaging National Assembly on Joint Committee on gas flaring, discrepancy, relevant MDAs and agencies to institute a mechanism that will bring accountability and transparency in the volume gas flared reported.

“We do not want to sleep with the achievement knowing that another set of people might be occupying the very power seats so we are requesting for a focus into Gas Flare Penalties, GHG Emissions and Nigeria’s NDC commitments. We want the issue of gas flaring to be an electoral issue for 2023 Nigeria election.”

She reiterated that government had, over the years, relied on Nigeria National Petroleum Corporation (NNPC) and the regulator for figures of gas flare before the World Bank launched the Gas Flare Tracker in Nigeria and that in 2020, the National Oil Spill Detection and Response Agency (NOSDRA), an agency of government for tracking gas flaring in Nigeria, using information from Gas Tracker, a Global Satellite Resource raised an alarm that Nigeria Government is under reporting the volume of gas flared in the country.

She noted that in May this year, the World Bank had flagged, aside Nigeria, several countries as being notorious for gas flaring. These countries include “Russia, Iraq, the United States, Venezuela, Algeria, Mexico, Libya and China and they accounted for 75% of global gas flaring.

“Within Nigeria, government agencies and oil operators are celebrating reduction in gas flaring but the 2022 Global Gas Flaring Tracker Report of the World Bank has a gloomy figure.”

Mrs. Esinwoke-Ogbalor recounted that despite the many deadlines set by the Nigeria government to ensure zero flaring in line with the United Nations mandate, gas flaring has remained a major issue in Nigeria, adding that Akwa Ibom people are the first hand victim of gas flare.

Her interaction with dwellers of several communities in the state revealed that gas flaring unleashes acid rain resulting in fast corrosion of metallic materials and other structural objects especially in oil exploration communities like Ibeno, Esit Eket, Onna, Eastern Obolo, Ikot Abasi, Mkpat Enin, Oron, Mbo and Orue Offong/Oruko.

NOSDRA, she said, had estimated the discrepancy in flare gas volume at 340bcf for 2018 and 2019, leading to an aggregate revenue loss of $680 million in unpaid penalties to the Federal Government of Nigeria for the two years put together by operating oil companies within that period and “the 2018 regulation did not stipulate penalties for venting of gas in brown fields limiting the penalties for venting to oil and gas green fields. Thus, oil and gas producers avoid the penalties for gas flaring by venting most of the gas (i.e mostly Methane (CH4), creating a very worrisome situation.

“The worry is that the vented gas (CH4) is about 80 times more powerful at warming the atmosphere than carbon dioxide and contributes to the formation of ground level ozone, a gas that is harmful to humans, ecosystems and crops. The lack of penalties prescribed for venting in brown fields raises the fear that the government supports venting and has deliberately excluded penalties for venting in ongoing production activities in the oil and gas sector.”

On the regulation of gas flaring, she maintained that it has been widely commended but some concerns are still raised whether the 2018 Gas Flare Regulations alone can assist Nigeria to meet its GHG emission and socio-economic development targets in light of some difficulties and inconsistencies observed in the implementation of the regulation including poor institutional transparency as well as poor accountability in the governance space.

It could be recalled that the Federal Government of Nigeria had gazetted the Flare Gas (Prevention of Waste and Pollution) Regulations 2018, a bill that was sponsored by the then chairman, Senate Committee on Gas Resources, Senator Bassey Albert Akpan.

The regulations sought to establish a new gas flaring payment regime for gas flared within an OML area or a marginal field. Companies that produce at least 10,000 barrels of oil per day shall be liable to a flare payment of $2 per 28.317 standard cubic meters (1,000 standard cubic fit (SCF) of gas flared.

However, companies which produce less than 10,000 barrels per day shall be liable to a flare payment of $0.5 per 28.317 standard cubic meters (1,000 SCF) of gas flared. This, she noted, was a significant increase from the erstwhile flat penalty of N10 per 1000 SCF of gas flared that has been in force since January 1998.

She then called on all to be committed to this course not only to ensure proper account for full revenue generated but to eliminate existing discrepancies in flared gas volumes reported for Nigeria and look forward to an increase of at least 2% of the funding for clean energy facilities in the 2023 budget.

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