Nigeria Loses N2.5bn Yearly To Gas Flaring – BudgIT

Omotola Collins
4 Min Read

BudgIT, a civil organization committed to public finance transparency and citizens engagement in public policy, has put Nigeria’s yearly loss to unbridled gas flaring at N2.5 billion.

Worried by the ugly development and the negative implications for the nation’s environment, people’s health and revenue potential, the organization advised the Federal Government to deal with the menace of gas flaring frontally.

While noting that some progress had been recorded in the fight against routine gas flaring over the last 20 years, BudgIT pointed out that latest analysis by its Extractives team showed that the volume of gas produced increased by 91.13% while the volume of gas flared reduced by only 38.06% between 2001 and 2016.

A statement issued by the organisation’s Communication Lead, Abiola Afolabi,  on the research findings indicated that this implied that oil companies invested more money in gas production activities and were less concerned about sufficiently investing in technologies and infrastructure to control gas flaring.

The research findings further showed that Nigeria had a potential for the consumption of un-flared gas.

As a way out of the crisis, BudgIT urged all stakeholders to commit towards putting in place the supply-framework, infrastructure and market systems necessary for un-flared gas to reach its end users needs.

In addition, it also urged the Federal Government to explore existing technologies and strategies to reduce the amount of gas flared into the atmosphere, though, some irresponsible oil companies are unwilling to make the investment necessary to deploy the right technologies and infrastructure in Nigeria.

This is even as the organization also canvassed the need for immediate review of the guiding legal framework for deterring gas flaring to prevent companies from taking advantage of inherent loopholes.

The organisation quoted the Finance Minister, Kemi Adeosun, on the current legal framework as saying that  “in current documents that cover the gas flaring penalty, the penalty was drafted as a charge. A charge is tax deductible; so when international oil companies flare the gas, they pay the charge on which they get tax relief”.

According to the statement, the BudgIT Team visited communities in the Niger Delta in April 2017 and observed several cases of gas flare near residential neighbourhoods, specifically Polaku and Ogu communities in Bayelsa and Rivers States respectively.

On the risks of gas flaring generally, BudgIT’s Lead Partner, Oluseun Onigbinde, called on the Federal Government to muster the political will necessary to execute Nigeria’s gas master plan and to enforce regulations aimed at tangibly achieving Zero Routine Gas Flaring.

“Also, proceeds from gas flare penalties can be channelled towards funding health-related research in the Niger Delta region, to protect the residents and improve their living conditions”, Onigbinde added.

The effects of gas flaring are not limited to deformity in children, lung damage, pneumonia, asthma, bronchitis, blood disorders and a host of other fatal health conditions.

 

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