Nigeria lost an estimated N189.90bn from January to November 2020 as international oil companies and local players flared a total of 178.95 billion standard cubic feet of natural gas.
The oil companies wasted 19.95 billion scf of gas in January; 18.27 billion scf in February; 19.71 billion scf in March; 17.90 billion scf in April, and 15.07 billion scf in May, according to data obtained from the Nigerian National Petroleum Corporation.
A total of 14.19 billion scf was flared in June; 14.15 billion scf in July; 13.62 billion scf in August; 14.79 billion scf in September; 13.98 billion scf in October, and 17.32 billion scf in November.
With the price of natural gas put at $2.80 per 1,000scf as of Wednesday, the 178.95 billion scf flared translates to an estimated loss of $501.06m or N189.90bn (using the official exchange rate of N379/dollar).
The NNPC in its latest monthly financial and operations report said a total of 222.34 billion scf of natural gas was produced in November, translating to an average daily production of 7.41 billion standard cubic feet per day.
It said, “For the period November 2019 to November 2020, a total of 3,004.06BCF of gas was produced, representing an average daily production of 7,642.69mmscfd during the period.
“Out of this volume, production from Joint Ventures accounted for 67.29 per cent, Production Sharing Contracts accounted for 19.97 per cent, while the Nigerian Petroleum Development Company accounted for 12.74 per cent.”
A further breakdown showed that a total of 137.41 billion scf of gas was commercialised, consisting of 39.99 billion scf and 97.42 billion scf for the domestic and export market respectively.
The report said, “This translates to a total supply of 1.33 billion scfd of gas to the domestic market and 3.25 billion scfd of gas supplied to the export market for the month.
“This implies that 62.55 per cent of the average daily gas produced was commercialised while the balance of 37.45 per cent was re-injected, used as upstream fuel gas or flared. Gas flare rate was 7.89 per cent for the month under review translating to 577.39 mmscfd.”
It said a total of 789 million scfd was delivered to gas-fired power plants in November to generate an average power of about 3,358 megawatts, compared with October when an average of 750 million scfd was supplied.
According to the revised payment regime for gas flaring, oil firms producing 10,000 barrels of oil or more per day will pay $2 per 1,000 standard cubic feet of gas, compared to N10 per 1,000 scf in the past.
Firms producing less than 10,000 barrels of oil per day will pay a gas flare penalty of $0.5 per 1,000 scf.