Between January 2022 and August 2023, Nigeria suffered a significant financial loss of approximately N843 billion due to the burning of natural gas, as revealed by the National Oil Spill Detection and Response Agency (NOSDRA). The report indicates that oil and gas companies operating in Nigeria burned a substantial amount of gas during this period. This wastage not only represents a financial loss but also has environmental consequences, including harmful carbon dioxide emissions.
Key Points:
- From January to August 2022, companies burned 147.1 billion standard cubic feet (SCF) of gas, valued at $514.9 million.
- During the same period in 2023, the amount of burned gas increased to 171.1 billion SCF, valued at about $599 million or N453 billion.
- This combined loss amounts to approximately N847 billion between the corresponding periods in 2022 and 2023.
- The volume of gas burned in the first eight months of 2023 was 16.28 percent higher compared to the same period in 2022.
- The wasted gas had the potential to generate around 17,100 gigawatts per hour of electricity and resulted in emissions of 9.1 million tonnes of harmful carbon dioxide.
- Responsible companies may face penalties totaling $342 million or around N251 billion, although a significant portion of these penalties remains uncollected by the Federal Government.
- In comparison, oil companies faced penalties of approximately $294 million (N223 billion) for oil spills between January and August 2022.
Analysis: The financial and environmental impacts of gas flaring in Nigeria are significant and highlight the urgent need for effective regulation and enforcement. It is crucial for the government to work closely with oil and gas companies to implement more sustainable practices and reduce gas flaring. Additionally, streamlining the collection of penalties and ensuring they are commensurate with the environmental impact can serve as a deterrent for non-compliance. Achieving the goal of zero gas flaring by 2060, as committed to the United Nations, will require sustained efforts and collaboration between all stakeholders.
