ENVIRONMENT-NIGERIA: New Attempts to Harness Gas Flares

By Toye Olori Reprint | | Print |

Toye Olori

LAGOS, Jun 27 2002 (IPS) - The government of Nigeria has embarked on a programme to end gas flares — which is causing environmental problems — by 2008.

Nigeria’s gas reserve is estimated at more than 150 trillion cubic feet.

Attempts to harness the flare, which is costing the West African country a fortune in lost revenue, began in 1998.

Two weeks ago, Rilwanu Lukman, Presidential Adviser on Petroleum and Energy, signed a Memorandum of Understanding (MOU) with Robert Smith, Managing Director of Statoil, to harness the flaring through modern technology.

The first phase of the project will focus on a feasibility study, which, Lukman says, “will last 15 months”.

After the study, the government will build five plants including one at the giant Nwanadoro Gas Field in the oil-rich Niger-Delta region to harness the wasted gas resources.

The plants, which are being funded by the Nigerian National Petroleum Corporation (NNPC), Shell, TotalFinaElf and Agip at 5.5 billion U.S. dollars, “will be based on well proven, modern technology to enable each plant to produce about four million tonnes of gas per annum”.

“With five plants in operation by 2005, Nigeria will become the third largest exporter of gas. Right now, we contribute seven percent. With the three plants we will be contributing up to 13 percent,” says a senior official at the Nigeria Liquefied Natural Gas (NLNG) Limited.

He says, “The Nigerian gas reserve is the 10th largest in the world. And unless we put a timetable to end the flaring by 2008, the gas would continue to be wasted. We should aim at shutting down flaring and turning gas into use and wealth for the country.”

Between 1999 and June this year, around 240 cargoes of gas were delivered to Europe and other parts of the world, making Nigeria one of the most reliable suppliers of gas in the Atlantic Basin.

To speed up the process of the new projects, the NLNG has signed a 160-million-U.S.-dollar agreement with six Nigerian banks to finance the expansion programme of the fourth and fifth plants.

“We are proud that the Nigerian banks have taken up the challenge of participating in the largest commercial loan made to a privately held company not only in Nigeria, but also in sub-Saharan Africa,” says Andrew Jamieson, NLNG Managing Director.

Nigeria, with a population of about 120 million, is seeking to raise up to one billion U.S. dollars from both local and international banks for the project.

The completion of the plants in 2005/2006 will increase Nigeria’s gas production from 5.9 million tonnes of gas to about 16.7 million tonnes per annum. It also will enable NLNG to process about three billion cubic feet per day of gas, which would otherwise be flared.

With the three plants in operation, Nigeria will be shutting down about 25 percent of gas flaring, while the fourth and fifth plants will reduce the quantity of gas being flared ‘substantially’, says the NLNG official.

NNPC holds 49 percent stake in NLNG; Shell 25.6 percent, TotalFinaElf 15 percent and Agip 10.4 percent.