Nigeria Losses #27bn to Gas Flaring.

BARRING other arrangements, Nigeria lost $133.716 million, about N26.743 billion to gas flaring in December 2014, as oil and gas companies in the country flared 20.11 per cent of their total gas production.

This, according to the Nigerian National Petroleum Corporation, NNPC’s Monthly Petroleum Information for December 2014, contrasts sharply with the $551.346 million (N110.27 billion) earned from the 183.783 billion Standard Cubic Feet, SCF, of gas utilised by companies in the period under review.

Specifically, the oil and gas companies produced 221.634 billion SCF of gas, utilised 183.78 billion SCF and flared 44.573 billion SCF. The Nigerian Gas Company, NGC, put the average price of gas at $3 per unit of 1,000 SCF, translating, therefore, to $133.716 million (N26.743 billion) for 44.573 billion SCF, and $551.346 million (N110.27 billion) for 183.783 billion SCF.

Sole Risk/Independent oil companies were the worst offenders, flaring 131.58 per cent of their sub-sector’s gas production and 11.84 per cent of the total gas produced by the oil and gas sector during the period.

Specifically, Sole Risks/Independents oil and gas companies produced 19.943 billion SCF of gas, utilised 348.26 million SCF and flared 26.241 billion SCF.

Marginal oil fields operators followed, flaring 48.61 per cent of the total gas produced in the sector, as they produced 2.275 billion SCF of gas, utilised 1.169 billion SCF and flared N1.106 billion SCF.

Production Sharing Companies flared 20.47 per cent of the total gas produced in the sub-sector, while Joint Venture, JV, companies flared 6.93 per cent of the total gas production. In particular, Production Sharing Companies, PSCs, produced 25.101 billion SCF, utilised 19.96 billion SCF and flared 5.139 billion SCF, while the JVs flared 12.087 billion SCF out of a total gas production of 174.215 billion SCF and utilised 162.303 billion SCF of gas.

Analysis of the quantity of gas flared on a company-by-company basis in the period under review showed that Nigerian Petroleum Development Company, NPDC, was the worst offender, flaring 154.13 per cent of its total gas production. NPDC produced 12.022 billion SCF of gas, utilised 138.045 million SCF, while it flared 18.53 billion SCF.

Seplat, First Hydrocarbon, Niger Delta Western, and Prime Energy followed, flaring 100 per cent of their total gas production. In particular, Seplat, flared 1.187 billion SCF; First Hydrocarbon 46.048 million SCF; Niger Western 5.448 billion SCF, while Prime flared 42.072 million SCF.

In addition, Platform Petroleum produced 791.408 million SCF of gas, utilised 2.139 million SCF and flared 789.269 million, representing 99.73 per cent of its total gas production. Allied/Camac Petroleum flared 92.76 per cent or 338.89 million SCF of gas out of the 365.35 million SCF of gas it produced.

Texaco produced 332.53 million SCF of gas, utilised 36.147 million SCF and flared 89.13 per cent or 296.385 million SCF of gas. Pillar Oil, on the other hand, produced 29.74 million SCF of gas, flared 26.44 million SCF, representing 88.9 per cent of its total production, while it utilised 3.3 million SCF. Trailing is Midwestern Oil and Gas, flaring 40.45 million SCF, representing 85.46 per cent of its 47.342 million SCF of gas produced, utilising only 6.88 million SCF