NUPRC threatens sanctions for undeveloped flare gas sites

The Nigerian Upstream Petroleum Regulatory Commission has warned that companies awarded flare gas commercialisation sites risk losing their permits if they fail to make substantial progress in developing the assets within one year.

The warning comes as Nigeria intensifies efforts to end routine gas flaring by 2030 and convert gas that would otherwise be burnt into products and services capable of supporting power generation, industrialisation and economic growth.

The Commission Chief Executive of the NUPRC, Oritsemeyiwa Eyesan, disclosed this during a working visit to the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, in Abuja.

According to a statement issued on Wednesday by the NUPRC Head of Corporate Communications and Media, Eniola Akinkuotu, Eyesan presented updates on the implementation of the Nigerian Gas Flare Commercialisation Programme and other key initiatives of the commission.

Eyesan said the regulator would no longer allow flare gas sites awarded under the programme to remain undeveloped indefinitely.

“One year after an award has been granted, the Commission conducts an evaluation to determine whether there has been considerable progress,” Eyesan said. “Where there is insufficient progress, the Commission will take appropriate regulatory action, including revocation of the award where necessary.”

Eyesan said the programme had continued to make progress despite resistance from some operators at the initial stage of implementation. She disclosed that 43 flare gas sites were originally identified for award under the programme, adding that 27 sites had so far been successfully awarded to investors.

Implementation activities are currently ongoing at the awarded sites, according to the NUPRC chief. The NGFCP was introduced to commercialise Nigeria’s flared gas resources by giving investors access to flare sites for the development of commercially viable gas projects.

The programme is expected to help Nigeria reduce environmental pollution, create jobs and generate additional revenue while increasing the volume of gas available for domestic industries and other productive uses.

The development comes as Nigeria seeks to unlock greater value from its enormous gas resources. The country currently has more than 215 trillion cubic feet of proven gas reserves, while its estimated total gas resource base stands at about 600 trillion cubic feet.

The CCE also gave an update on the implementation of the Host Community Development Trust framework established under the Petroleum Industry Act.

According to her, the framework was introduced to address longstanding grievances in oil-producing communities and ensure that petroleum resources contribute more directly to sustainable development in host areas.

“To date, 173 Host Community Development Trusts have been incorporated, 147 have been funded, over 1,001 projects are currently ongoing, while more than 200 projects have been successfully commissioned across host communities,” she said.

In his remarks, the Minister of State for Petroleum Resources (Gas), Ekpo, called for a more deliberate and aggressive implementation of Nigeria’s gas commercialisation programme.

He said the country must accelerate efforts to meet its target of eliminating routine gas flaring by 2030. “The core objective is to add value to our gas resources by converting them into critical products and services. We must move away from environmental pollution and toward productive resource utilization,” the minister said.