Nigerian Oil, Gas Firms Flare $1.24bn Gas in 12 Months

 

While end appears not in sight over the high cost of cooking gas in Nigeria, the country continued to reel under the burden of waste of this essential commodity, as oil and gas companies operating in the country flared 354 billion cubic feet (BCF) of gas in the whole of 2020, according to data released by the National Oil Spill Detection and Response Agency (NOSDRA).

The volume of gas flared in the 12-month period, according to the NOSDRA’s report on gas flaring by oil firms, represented a loss of $1.24 billion, an equivalent of N469.96 billion, to the Nigerian economy, a 22.5 per cent decline compared to the $1.6 billion (N606.4 billion) lost to gas flaring in 2019.

The report also noted that the volume of gas flared in 2020, was 24.07 per cent lower than the 466.2 BCF of gas flared in 2019.

The NOSDRA report highlighted that the 354 BCF of gas flared in 2020 was equivalent to 19 million tonnes of Carbon dioxide (CO2) emission into the atmosphere, contributing to global warming.

It added that the companies were liable to a fine of $708 million, about N268.332 billion, many of which it claimed are not collected from the oil companies, while it also stated that the flared gas was capable of generating 35,400 gigawatts hours of electricity, equivalent to the annual electricity of 804 million Nigerian citizens.

Giving a breakdown of the quantity of gas flared on a month-on-month basis, the NOSDRA report noted that in January, February, March, April, May, and June 2020, 38.54 BCF of gas, 32.02 BCF, 35.8 BCF, 39.49 BCF, 38.88 BCF and 29.05 BCF of gas were flared respectively, while 18.34 BCF, 24.77 BCF, 8.29 BCF and 21.45 BCF, 32 BCF and 33 BCF of gas were flared in July, August, September, October, November and December 2020, respectively.

While significant portion of the total gas produced in the country is flared on a daily basis, the price of cooking gas in Nigeria, despite the largely stable price of gas in the international market, had continue to skyrocket, rising from about N3,000 for a 12 kilogramme (KG) cylinder of the commodity in 2019, to between 4,500 and N5,000 across the country, today.

The reason for the rise remains unknown, despite the fact that the Federal Government had in 2018, removed the Value Added Tax (VAT) placed on locally-produced cooking gas.

However, in its Liquefied Petroleum Gas (Cooking Gas) Price Watch for March 2021, the National Bureau of Statistics (NBS), disclosed that the average price for the refilling of a 12.5kg cylinder for cooking gas in Nigeria decreased by 0.10 per cent month-on-month (March 2021 versus February 2021) and increased by 4.26 per cent year-on-year (March 2021 and March 2020) to N4,359.23 in March 2021 from N4,363.51 in February 2021.

The NBS said: “States with the highest average price for the refilling of a 12.5kg cylinder for Liquefied Petroleum Gas (cooking gas) were Cross River (N4,762.65), Sokoto (N4,750.00) and Edo (N4,728.57). States with the lowest average price for the refilling of a 12.5kg cylinder for Liquefied Petroleum Gas were Zamfara (N3,749.06), Kaduna (N3,751.27) and Katsina (N3,845.04).”

 

 

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