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Nigeria Loses N184 Billion to Gas Flaring in H1 2022

Nigeria lost N184 billion to gas flaring in the first half (H1) of 2022, the Nigerian Oil Spill Monitor.

Published

1 year ago

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Oil and Gas

Nigeria, Africa’s largest economy, lost N184 billion to gas flaring in the first half (H1) of 2022, the Nigerian Oil Spill Monitor, a unit under the Nigerian Oil Spill Detection and Response Agency (NOSDRA), reported on Sunday.

Despite Nigeria’s huge gas deposits, Africa’s largest economy continues to struggle with the necessary infrastructure needed to convert gas flaring to useful natural liquified gas. In the last 18 months, Nigeria has lost almost a trillion Naira in gas value.

The report showed that Nigeria lost a total sum of N707 billion in 2021 alone while another N184 billion was lost in the first half of 2022.

NOSDRA report noted that gas companies operating in the country flared 126 billion standard cubic feet (SCF) of gas in the first six months of 2022, resulting in $441.2 million or N188.887 billion (using the I&E exchange rate) lost.

Further analysis of the report showed that oil firms operating in the offshore oilfields flared 62.2 billion SCF of gas valued at $217.6 million in the first half of 2022. However, companies operating onshore flared a total of 63.9 billion SCF, estimated at $223.6 million.

Speaking on the situation, Prof. Olalekan Olafuyi, the Chairman of the Society of Petroleum Engineers (SPE), Nigeria Council, in an interview on Sunday, said the Federal Government is working on raising gas flaring penalties to further compel oil companies operating in the country to comply with the existing gas policy.

He said “We are working closely with the Nigerian Upstream Petroleum Regulatory Commission, and I can categorically say that companies who flare gas will now pay more than those utilising it. So, it will be to their advantage to start thinking of ways to utilise their gas instead of flaring them.”

Presently, the federal government imposed a penalty of $2 on 1000 SCF of gas flared by oil companies producing above 10,000 barrels per day (bpd). While companies producing less than 10,000 bpd are fined $0.5 per 1000 scf of gas flared.

Even though Olafuyi did not state how much increase the new rate would attract, he said the Federal Government is working with the Nigerian Upstream Petroleum Regulatory Commission (BUPRC) to devise a suitable penalty increase.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Energy

Nigeria and Germany Ink $500 Million Agreements for Renewable Energy and Gas Exports

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1 week ago

on

November 22, 2023

By

Renewable Energy

Nigerian and German companies have sealed two pivotal agreements in Berlin, valued at $500 million.

The accords, announced by Presidential spokesperson Ajuri Ngelale, include a renewable energy pact and a gas export deal, marking a significant milestone in bilateral cooperation.

The first agreement formalized a Memorandum of Understanding on renewable energy between the Union Bank of Nigeria and Germany’s DWS Group.

This strategic partnership seeks to attract $500 million in investments dedicated to renewable energy projects, with a primary focus on rural communities across Nigeria.

The second Memorandum of Understanding solidified a gas export partnership between Riverside LNG of Nigeria and Germany’s Johannes Schuetze Energy Import AG. Under this deal, Nigeria commits to supplying 850,000 tons of natural gas annually to Germany, with projections indicating an increase to 1.2 million tons.

The initial shipments are scheduled for 2026, addressing both nations’ commitment to environmentally conscious practices and sustainable energy solutions.

This gas export agreement is particularly significant as it contributes to processing approximately 50 million cubic feet per day of natural gas that would otherwise be flared, aligning with Nigeria’s goal to harness its abundant gas resources for sustainable energy projects.

President Bola Tinubu, attending the G20 Compact with Africa conference in Berlin, expressed his approval of the agreements, emphasizing Nigeria’s commitment to reforms. Chancellor Olaf Scholz of Germany also announced a 4 billion euro investment in green energy projects in Africa by 2030, aligning with Germany’s transition to carbon neutrality.

Despite challenges such as oil theft, Nigeria, under President Tinubu’s leadership, has undertaken significant reforms to attract investors and revitalize its economy.

These agreements signify a step toward sustainable energy solutions, addressing environmental concerns and fostering economic growth in both nations.

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Energy

Sun Africa Commits $2.2 Billion to Transform Nigeria’s Power Sector

Published

1 week ago

on

November 20, 2023

By

ossiomo

Sun Africa LLC, a global entity dedicated to supporting Africa’s energy needs, has announced a commitment of approximately $2.2 billion for the development of Nigeria’s power sector.

The pledge follows a meeting between the Minister of Power, Adebayo Adelabu, and representatives from Sun Africa, led by Chairman Goran Rajsic.

In the initial phase, the project will concentrate on delivering 961 MWp of solar PV infrastructure and 455 MWh of battery energy storage, marking a transformative venture valued at $2.2 billion.

This strategic collaboration aims to address Nigeria’s growing demand for new power infrastructure, aligning with the nation’s economic needs and transitioning toward sustainability.

Adelabu emphasized Nigeria’s significant requirement for new power infrastructure to support economic growth and sustainability.

The commitment from Sun Africa and its partners signifies a crucial step toward achieving Nigeria’s electricity goals.

Goran Rajsic expressed gratitude to the project partners, highlighting the support in designing a comprehensive solution featuring cutting-edge solar PV and battery storage technologies.

Sun Africa’s collaboration with Sterling & Wilson Renewable Energy Limited as its EPC partner represents a milestone in advancing sustainable and reliable energy solutions for Nigeria.

This initiative aligns with the nation’s commitment to driving positive change through innovative renewable energy solutions.

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Energy

Niger Delta Power Holding Company Reveals N190bn Debt Owed by Government Entities

Published

2 weeks ago

on

November 14, 2023

By

power project

The Niger Delta Power Holding Company (NDPHC) has disclosed that the Central Bank of Nigeria (CBN), the Nigerian Bulk Electricity Trading Plc (NBET), and the Nigerian Electricity Liability Management Company owe a cumulative sum of N190 billion for electricity supply.

Chiedu Ugbo, the Managing Director and CEO of NDPHC, shared this information during a media briefing in Lagos.

Ugbo highlighted that the N190 billion debt has accumulated from 2015 to May 2023. While the exact amount owed by NBET wasn’t specified, Ugbo emphasized that the huge indebtedness to NDPHC runs into hundreds of billions, affecting the company’s operations and financial obligations.

He stated, “NDPHC is also not paid for availability but only as dispatched, thereby depriving NDPHC of hundreds of billions since 2015 when the Transitional Electricity Market was declared, and the government has so far been denied revenue as high as N3trn.”

Ugbo emphasized the challenging situation the debt has created, making it difficult for NDPHC to meet operational expenditures, pay gas suppliers, and maintain regular power generation.

To overcome these challenges, he called for urgent private capital mobilization and explored independent transmission projects, involving Gencos as investors.

Executive Director, Generation, Engr. Abdullahi Kassim, highlighted the ‘Light-up Nigeria Initiative,’ a program aimed at leveraging NDPHC’s generation assets to provide reliable power supply to eligible customers, distribution companies, and third-party project developers, ultimately achieving over 97% power distribution to the masses.

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