KEY POINTS
- Power Africa backs Nigeria’s goal to end gas flaring by 2030.
- NGFCP will issue permits for flare-gas buyers in 2024.
- The initiative advances emissions reduction and economic diversification.
Power Africa reports that companies typically flare gas on-site because exporting it is not economically viable.
Nigeria is among the top seven gas-flaring nations in the world. According to Power Africa, the country’s flaring activities emit a substantial amount of carbon emissions, which have an impact on the environment, the economy, and the health of the two million people who live close to flaring sites.
Power Africa supports Nigeria’s ambitious gas-flaring reduction goals
According to Power Africa, an initiative spearheaded by the US government to add 30,000 megawatts and 60 million electrical connections in sub-Saharan Africa by 2030, Nigeria has particular difficulties because it is one of the continent’s top oil-producing countries. The processing of heavy crude oil there produces “associated gas,” a byproduct that is frequently flared and adds to global warming.
ESI Africa reported that the Nigerian government wants to meet its energy needs while reducing its impact on the climate, therefore it has set a 2030 deadline to stop gas flaring. At the centre of this endeavour is the Nigeria Gas Flare Commercialisation Programme (NGFCP).
The NGFCP will enable flare-gas buyers to finance and carry out gas flare-reduction projects by issuing permits in late 2024. The program, which was started in 2016, intends to collect flared gas and use it to generate electricity.
The purpose of these projects, which include private investors through competitive bidding is to reduce Nigeria’s carbon emissions and forward the country’s objectives for power generation. The program aligns with Nigeria’s Nationally Determined Contributions (NDCs) and fulfills its obligations under the 2015 Paris Agreement.
Power Africa has been assisting Nigeria’s NGFCP since 2018 by creating a competitive bidding process, assisting in the development of its commercial framework, and creating evaluation standards for potential bidders. This initiative has pre-qualified 205 private sector bidders to use flare gas for producing electricity and other valuable purposes.
Power Africa aids competitive bidding process
In 2022, Power Africa helped identify 49 flare sites for sale, leading to significant carbon dioxide emissions reductions. The flare sites contributed to an annual release of nearly six million metric tonnes of carbon dioxide. In 2023, the NGFCP selected 42 businesses to participate in the first phase of the bidding process, paving the way for focused flare-gas mitigation initiatives.
To improve the Nigerian Upstream Petroleum Regulatory Commission’s (NUPRC) capacity to oversee the program, Power Africa also co-led a training on best practices and gas contract administration.
The collaboration between Power Africa, the NGFCP, and partners like the World Bank is expected to bring significant benefits. They will help advance Nigeria’s NDC objectives by reducing greenhouse gas emissions and converting methane into a valuable resource.
Additionally, the program encourages local employment, expands export markets for US and foreign energy providers, and advances Nigeria’s efforts to diversify its economy.
The Nigeria Gas Flare Commercialisation Programme Investors Forum was co-hosted by Power Africa and the NUPRC in April 2024. The forum attracted 154 attendees, including developers, investors, and business executives, from various sectors. During the event, participants discussed technology and funding options for the commercialisation of flare gas resources.
These conversations are focused on viable methods for reducing gas flares and transforming them into valuable energy sources. The forum provided a platform for purchasers and financiers to explore opportunities in Nigeria’s flare gas reduction efforts.
Kelechi Onyekachi, the Executive Commissioner of Corporate Services and Administration at the NUPRC, praised Power Africa’s services to the NGFCP. According to Onyekachi, “The Commission greatly values the partnership and expertise provided by the Power Africa team.”
To assist developers in becoming investment-ready, Power Africa continues to support the NUPRC by examining agreements, organising investor meetings, and offering consulting sessions.
