How Oil & Gas Companies In Nigeria Destroy The Environment Because Of Money

oil and gas companies in nigeria

April 15, 2013 – How Nigerian Oil & Gas Companies Destroy The Environment Because Of Money

Oil and gas companies in Nigeria see zero percent gas flaring as a mirage. They are much concerned with the hauling out of their products. Left to them, they have no business with the protection of the environment in which they operate. Alternatively, they are much interested in the quantity of produce that will accrue from their onshore or offshore oil wells, with no recourse to the environmental brunt of burning associated gas from oil drilling sites.

The maddening part of this issue is that the companies see flared gas into the environment as waste or unusable, even though they knew that gas flare, otherwise known as a flare stack, is cutting the environment into strips.

This environmental unfriendly act is against the judgment of legal luminaries, human and environmental rights crusaders across the country. These groups have declared that the flaring of gas is illegal, no matter the perception of the oil companies in the areas of industrial plants such as petroleum refineries, chemical plants, and natural gas processing plants.

Hazard:

Experts on environment say that the hazard of flaring gas also constitutes a hazard to human health. They say that gas flaring contributes to the worldwide anthropogenic emissions of carbon dioxide.

“For example, oil refinery flare stacks may emit methane and other volatile organic compounds as well as sulfur dioxide and other sulfur compounds, and toxics… all of which are known to exacerbate asthma and other respiratory problems,” a report says.

Another says, “flaring at oil and gas production sites may emit methane, sulfur dioxide, aromatic hydrocarbons (benzene, toluene and xylenes), as well as carcinogens such as benzapyrene.”

Ignorance:

It is very absurd that the government of Nigeria has said much about ending gas flaring by December 31st 2012, but less than 50% has been achieved out of this promise. In some reports, technological and economic implications are fingered as being involved for the un-accomplishment.

The worst side of the story is that many Nigerians are not informed of the nature and extent gas flaring is damaging the environment. They rather see gas flaring as part of the government businesses that should not be snooped into or questioned.

Against this backdrop, the oil companies and government hold unto the ignorance of the people in their continued efforts to pollute the environment because of economic interest.

For this monetary lucre, Nigeria has been recorded as the highest gas flaring country in Africa, both in absolute and proportionate terms.

Apologists:

Expectations by Nigerians were high that the December 31st 2012 deadline given to oil exploration companies by the National Assembly to stop gas flaring activities in all the oil fields in Nigeria would be anything to go by.

But government apologists were either warning that why should there be what they termed “all the noise” about stopping gas flaring in the country, when, according to them, a country like Russia tops the rest of the world as the highest emitter, upon that she is ranked as a developed country.

“The United States of America in spite of her technological prowess and commitment to environmental ideals remain as the world’s 5th largest emitter of this poisonous smoke,” says a source.

Beginning:

In 1969, General Yakubu Gowon was Head of State. Seemingly, he allowed oil operators a 5 year ultimatum within which to bring to a halt gas flaring.

Critics have always slammed him that he did not put in place an organizational apparatus that would put the admittance he granted to these oil companies to an end. Till date, the oil companies are having a field day.

Gowon’s decision was regarded as a “military pronouncement”. Oil companies across the country hold hand on that decision that stopping the flaring of gas would amount to a total shut down of its operations in Nigeria. But the possibility of Nigeria paying this prize is still farfetched.

Monetary Waste:

Second to Russia, Nigeria is said to be burning off an equivalent of USD1.4 billion dollars annually, but this is profoundly in a most contemptuous disregard to laws and judicial declarations on gas flaring.

According to a report in the media on Monday, March 4th, 2013, Minister of Petroleum Resources, Diezani Alison-Madueke says that the country has a “new target”, which is not to bring a total end to gas flaring but to meet 22 per cent of gas flaring reduction by 2017, which is characterised as “on the short-term”.

This statement was coming when a report by World Bank showed that gas flaring continues much to aid climate change, among major oil countries.

Responding to the bank’s petition, Nnimmo Bassey, director of Lagos-based Environmental Rights Action and chair of Friends of the Earth International purportedly said: “Gas flares are nothing short of crimes against humanity. They roast the skies, kill crops and poison the air. These gas stacks pump up greenhouse gases into the atmosphere, impacting the climate, placing everyone at risk. Gas flares go on because it is cheap to kill, as long as profits keep on the rise.”

The World Bank in the report says that while flaring has been cut by 30% since 2005, $50bn worth of gas is still wasted annually.

“Azerbaijan has cut flaring by 50% in two years, Mexico by 66% and Kuwait now only flares 1% of its excess gas. Other countries, including Qatar and the Democratic Republic of the Congo, now use large volumes of previously wasted gas to generate electricity,” says the bank.

Albeit, it is nonplus how gas flaring which the bank said was reduced from 172bn cubic metres a year in 2007 did not go down below 142bn cubic metres in 2011. The question is whether politics and oil money will allow Nigeria to be among the countries that the bank has urged to reduce flaring by at least 30% in the next five years.

The report continued that it makes financial and developmental sense. Quoting Rachel Kyte, World Bank vice-president for Sustainable Development: “It’s a realistic goal. Given the need for energy in so many countries – one in five people in the world are without electricity – we simply cannot afford to waste this gas any more…. The direction of travel is right but whether it is at the speed or pace needed is another matter. But no country now that does not want to wrestle with this issue.”

Sir Suma Chakrabarti, president of the European Bank for Reconstruction and Development is cited as saying: “This major waste of a natural resource can be turned into profitable development investments.”

A spokesperson for French oil company – Total, which has committed to bisecting the volume it flares by 2014, says: “Flaring is very stupid, for sure. But stopping it is difficult. We are going in the right direction but it takes time.”

World Bank in the report rates Nigeria as the biggest in gas flaring in Africa.

Illegality:

The Nigerian Supreme Court in 2005 saw oil flaring as illegal having formally banned it in 1984 and declared it “unconstitutional”, yet figures show that companies on the delta did not stop, but have only reduced to flaring 10% since 2007.

This attitude still boils down to economic gain.

“Look at the scenario confronting us – The multinational Oil corporations are burning off our valuable gas resource in spite of our laws, suddenly, they discovered, through science that the gas emission is creating a global warming phenomena, which is the cause of the unbearable heat spreading across the earth, apart from its health hazards,” exudes a source.

As part of its efforts in ending this illegality, report in the media of November 1, 2012 believes that the Federal Government may shut oil fields even if it means a loss of revenue.

The Director, Department of Petroleum Resources, Mr. Osten Olorunsola, apparently says: “One of the things we are doing is to do some analysis for government, to such an extent that it will even mean a proposal to shut down fields to avert huge gas flaring. We will probably make that position known to government very soon.”

Gowon, had pointed out in 2011, how Nigeria had lost her leading role in Liquefied Natural Gas production to countries such as Qatar and Australia: “Last year, this country flared over 460 billion standard cubic feet of gas that, if processed and exported, would have fetched the country over $2 billion and minimised the health and environmental impact of gas flares.”

This claim has the support of a Bureau of Public Enterprises study, which estimates Nigeria’s losses to gas flaring at between $500 million and $2.5 billion a year.

Gowon maintains: “Think of how the oil palm industry left Nigeria for Malaysia. Think of how athletics – we won gold in Sydney (Australia) in 2000 – left Nigeria for Jamaica. And, worst of all, countries we started out with in the LNG business have all left us behind.”

Still according to Gowon, while Qatar’s production has moved from 20 million tonnes to the range of 80 million tonnes and Australia is also targeting 80 million tonnes, Nigeria’s progress has been stymied.

“All the LNG projects on the drawing board in Nigeria – LNG Train Seven – will only add 30 million tonnes to our national output, which is not that much when compared to Australia, which has only 60 per cent of our reserves.”

Job:

By Friday, 25 March 2011 the Federal Government had set agenda for ending gas flaring and unveiled what was regarded as “ambitious $10bn gas revolution” and to create 500,000 direct and indirect jobs.

It made this disclosure during the formal launching of the Gas Revolution in the country. So they said, it signed two Memoranda of Understanding (MOU) – one between Xenel and the Nigerian National Petroleum Corporation (NNPC), and the other among India’s Nagarjuna Fertilizers, NNPC and Chevron – as well as the award of the Akwa Ibom/Calabar area gas central processing facility (CPF) to Agip and Oando in Abuja – winners of the bid.

President Goodluck Jonathan says the novel gas agenda has set the manner for wealth establishment in Nigeria.

President Jonathan tells industry executives, government officials and diplomats at the launch of the plan in Abuja, the seat of power: “This agenda sets the tone for the final elimination of gas flaring in Nigeria as the markets created provide a sink for all currently flared gas. As we sustainably eliminate flare, we mobilise this valuable commodity which, for several years, we have wasted”.

There is a notion that Agip and Oando are to build a natural gas processing facility at (Obiafu) in Rivers State.

Andrew Fawthrop, Chevron’s managing director in Nigeria, tells newsmen: “We’ve agreed to begin with 175 million (cubic feet) of gas per day. We will deliver the gas once the pipelines and other infrastructure are in place.”

While Saudi Arabian firm – Natpet, a subsidiary of petrochemicals firm – Alujain, says it will invest $3.5 billion in a petrochemical plant apparently, India’s Nagarjuna Fertilisers says it has devoted to building two fertiliser plants – an investment of around $2.5 billion.

All these promises are yet to hold water. What critics has termed “politically speaking”, Jonathan evidently says: “Today’s event marks the beginning of what I believe will be a fulfilling journey towards the restoration of Nigeria to the league of nations which have successfully leveraged on the advantage derivable from the abundance of natural gas to positively impact on the lives of present and future generations of their citizens…. The government on the fertiliser project means we expect a significant increase in employment from the agricultural sector. In the total, this initiative will result in over 500,000 direct and indirect jobs in construction, logistics, hotel and hospitality service, fabrication, banking and, above all, agriculture.”

President Jonathan further divulges that going by the anticipation of government: “By 2014, we would have positioned Nigeria firmly as the undisputed regional hub for such gas-based industries as fertiliser, petrochemicals and methanol… we recognise that our objective can only be achieved through a revolution…. The petrochemical industry will provide us with the potential not only to manufacture low-end plastic and packaging products, but also very high-end products. With a capacity that spans such a wide continuum, there is opportunity for industrialisation”.

Way Forward:

Since the adopted report of the House of Representatives in 2009, setting December 31, 2012 as the new date for the achievement of zero gas flaring in the country failed, experts say that there is still a way out.

The resolve in that report which the lawmakers made that any company that declared an inaccurately flared gas volume should pay a penalty fee of $100,000, should be re-addressed to bar perpetrators. Since the House could not meet the mandate, the report of its committees on gas resources and justice on a bill for an Act to amend the Associated Gas Re-injection Act, No.99 of 1979 Cap.A25 laws of the Federation of Nigeria, 2004, should not be spent.

It should be strict to submissions made by the Ministry of Petroleum Resources, DPR, Nigerian National Petroleum Corporation (NNPC), Shell Petroleum Development Corporation (SPDC), Exxon Mobil Nigeria Unlimited, Total Nigeria, Chevron, Addax, National Agip Oil Company and Nigeria Civil Society Platform Against Gas Flaring at the public hearing held on March 10, 2009, because treating this issue with the kid’s glove could be the reason  the January 1, 1984 deadline to end gas flaring was substituted with a new date of December 31, 2012.

What is the sense of gas flaring to cost Nigeria over $1bn every year or N99bn in 6 months? Experts also say that it is possible to stop gas flaring either through re-injection or utilisation.

“Gas flaring should be brought to an end because of the monumental waste of resources especially in a country like Nigeria where energy demand surpasses supply and where over 70% of the population still live in abject poverty… the extent of environmental degradation that gas flaring causes is enormous and therefore stopping gas flaring will reduce the environmental and health effects.”

Another report concludes: “All that is needed is to set up the framework to achieve this. This may involve substantial investment and may be unsustainable economically, if the volume of gas flared is not enough to recoup the investment. Even so, it may be a viable option on environmental or other grounds. There are countries such as the Netherlands where there is zero percent gas flaring.”

About the author: Odimegwu Onwumere, Poet/Author, Media/Writing Consultant and Motivator, is the Founder of PoetAgainst Child Abuse (PACA), Rivers State.