Oil companies operating in Nigeria won’t be allowed to flare gas from the end of this year, said Nigerian Minister of State for Foreign Affairs Bagudu Hirse.
The West African nation needs the gas to meet demand for power generation in the country as well as supply proposed gas pipelines from the Niger River delta, Hirse told reporters today in the capital, Abuja. Gas flaring occurs when the fuel is burnt during the course of oil production.
“It’s a government policy,” he said. The oil companies “will be able to meet the deadline. They have all been informed.”
Nigeria, with reserves of more than 30 billion barrels of crude and more than 187 trillion cubic feet of gas, loses $3 billion a year as a result of flaring of gas, according to the Petroleum Ministry.
Previous deadlines imposed by the Nigerian government to end gas flaring at the end of 2004, 2007 and 2008 haven’t been met. Oil companies have blamed their failure to stop flaring on the inadequate funding from the government and insecurity in the delta, where insurgents have attacked oil-company personnel and facilities.
Since the last deadline passed, the government hasn’t issued a new one. Instead, Petroleum Ministry officials have tied ending gas glaring to the execution of a so-called gas master-plan. The country plans to spend $30 billion to build a gas-pipeline network and processing facilities to supply domestic users, as well as a pipeline across the Sahara Desert to Europe.
Calls to Petroleum Minister of State Odein Ajumogobia’s mobile phone didn’t connect when Bloomberg News called him today for comment on Hirse’s announcement.
Nov122009