According to a report by the National Oil Spill Detection and Response Agency, NOSDRA, oil and gas companies operating in Nigeria flared 92.3 million standard cubic feet, or mscf, of gas between January and April 2023, costing an estimated N150 billion.
In comparison to gas flared at a rate of 50.3 mscf during the same period in 2022, this indicates an increase of 79.5 percent.
The 92.3mscf of gas that was flared over the course of four months in 2023 resulted in a $323.1 million loss in gas value, or nearly N150.08 billion (at the current CBN exchange rate of N464.5 per dollar), according to the gas flare tracker that was received from NOSDRA.
As a result of breaking the gas flaring restrictions during a four-month period, the oil producing companies in charge of this flaring are likely to pay fines totaling $184.6 million (the equivalent of N85.7 billion).
However, based on prior flare reports, it appears that the oil giants will soon pay the fines because multiple billions of dollars in unpaid fines have been logged against the firms’ records for years.
According to the analysis, the amount of gas flared over the course of four months is equivalent to 4.9 million tonnes of carbon dioxide emissions and has a 9,200 gigawatt-hour potential for electricity production.
According to the data, monthly gas flares in January, February, March, and April totaled 23.2 mscf, 27.1 mscf, 25.9 mscf, and 16.1 mscf, respectively.
The Petroleum Industry Act 2021 (PIA), which former President Muhammadu Buhari signed into law on August 16, 2021, is the main and comprehensive framework that governs the oil and gas industry in Nigeria. It offers a framework to control and eventually eliminate gas flaring in the nation. Gas flaring by any licensee, lessee, or marginal field operator is prohibited by Section 104 of the PIA, with the exception of three circumstances: emergencies, exemptions from the Nigerian Upstream Petroleum Regulatory Commission, and situations where it is deemed acceptable as a safety practice under established regulation.
Additionally, anyone who violates Section 104 of the PIA is penalized under Section 105 of the same law. The Flare Gas (Prevention of Waste and Pollution) Regulations of 2018 (The Regulation) set forth these penalties.