The Federal Government says it has received 226 effective bids from companies that wish to participate in the country’s quest to end gas flaring at 178 locations that have already been identified.
Minister of State for Petroleum Resources, Dr Ibe Kachikwu, said this at a press conference tagged ‘The journey so far and the next line of action for the Nigerian Gas Flare Commercialisation programme’ in Abuja on Thursday.
Kachikwu who inaugurated a committee to evaluate the bids disclosed that although more than 800 expressions of interest were received from various entities, 226 bids had been backed with the payment of the compulsory $1,000 by the end of deadline for bid submission.
Speaking to the press at the event, Kachikwu insisted that Nigeria was committed to stopping gas flaring 10 years ahead of the deadline given by the United Nations.
At the event, Chairman, Ministerial Steering Committee of the Nigerian Gas Flare Commercialisation Programme, Mr Rabiu Suleiman, said about $ 3.5bn worth of inward investments by third party investors were required to achieve the gas flare commercialisation target by 2020.
Kachikwu said, “The policy on gas flaring is encapsulated in the National Gas Policy approved by the Federal Executive Council in June 2017. The National Gas Policy commits to ending gas flaring, creating an enabling environment for investors, seeking value addition for gas, and improving governance in the sector.
“The Federal Government will work to grant open access to all pipelines and other essential midstream infrastructure. With respect to pricing of gas for the domestic market, which is largely controlled by the Federal Government under a transitional pricing framework, the current framework will be retained for a limited period until a sufficient gas market is established.
“The policy objective is to move to market-led wholesale gas pricing without gas price regulation, except where there are natural monopolies.
“The FGN included gas flare reduction as a key national greenhouse gas emissions mitigation in its Nationally Determined Contributions under the United Nations Framework Convention on Climate Change.”
He added, “Premised on the foregoing, the policy position of President Muhammadu Buhari is that gas flaring is totally unacceptable. In this regard, the Federal Government initiated a number of actions to reaffirm its commitment to ending the practice of gas flaring in our oil fields.
“Specifically, the president ratified the Paris Climate Change Agreement, and the FGN is a signatory to the Global Gas Flaring Partnership principles for global flare-out by 2030 whilst committing to a national flare-out target by year 2020.
“Furthermore, in recognition that flared gas could be harnessed to stimulate economic growth, drive investments and provide jobs in oil producing communities and indeed for Nigerians through the utilisation of widely available innovative technologies, the Federal Executive Council in June 2016, approved the Nigerian Gas Flare Commercialisation Programme.”
Suleiman said although the country had achieved 70 per cent decline in flaring over the past decade as a result of NNPC and their JV partners efforts, Nigeria still flared about 324 BCF of gas in 2017, exceeding the meagre ~800 MMSCFD utilised for power generation and ~450 MMSCFD utilised in domestic market.
He said that harnessing gas from the biggest 50 flare points would reduce flare gas volumes by 80 per cent, considering the 2015 identified gas flare locations and volumes as the baseline.