A Review of the Nigerian Energy Industry

Shell emits 6m tonnes of carbon dioxide in Nigeria

Clara Nwachukwu

18 April 2012, Sweetcrude, LAGOS – ANGLO Dutch Shell has confessed to emitting as much as 6.1 million tonnes of carbon dioxide, C02, into the Nigerian environment during oil and gas operations in 2011.

The admission comes, even as the international community continues to raise alarm on the effect of such emissions on humans, plants and animals in terms of increased global warning and attendant health hazards on the people.

Shell in its 2011 Sustainability Report posted on its official website said the current flare rate was, however, almost a 20 percent reduction over the 2010 figures.

“We made progress in reducing flaring in Nigeria in 2011. Although onshore oil production in Nigeria rose by around 4%, flaring emissions were down almost 20%, to 6.1 million tonnes of CO2 equivalent.”

The company also admitted that “around 80% of this continuous flaring (global operation) took place in Nigeria,” thus, raising questions on its energy efficiency performance and house cleaning attitudes demanded by Nigeria’s oil and gas industry regulators.

Indeed, the report acknowledged, “In 2011, the overall energy efficiency for the production of oil and gas in our upstream business worsened slightly compared to 2010, but was around the same level as in earlier years.”

But Shell blamed the situation in Nigeria on “the security situation and lack of government funding,” which “has previously slowed progress on projects to capture the gas.”

According to the Wall Street Journal, “Carbon emissions, most notably carbon dioxide (CO2), are part of a collection of gases that negatively influence the quality of our air and increase the greenhouse effect.”

It further explained that “Greenhouse gases have a direct influence on the environment, causing extreme weather changes, a global temperature increase, the loss of ecosystems and potentially hazardous health effects for people.

But the environment pollution from operational activities could have been worse, but for the fact that Shell said it brought in “more gas-gathering equipment and more controls were applied to sites with higher levels of gas associated with oil production.”

Globally, the report noted that “Operational flaring for safety reasons, or during the start-up of Upstream facilities, accounted for around 35% of flaring emissions. We aim to minimise this operational flaring.”

“Continuous flaring, due to a lack of equipment to capture the gas produced with oil, accounted for the remaining 65% of flaring emissions,” it added.

Going forward, the report further said, “All our major facilities have energy management plans in place that include making the best use of those facilities and using improved techniques in field management. We expect that maintaining the energy efficiency levels of recent years will be difficult in the future as existing fields age and production comes from more energy-intensive sources.”

Enforcement weaknesses
For decades, the Nigerian industry regulators – the Department of Petroleum Resources, DPR, and the National Environmental Standards and Regulations Enforcement Agency, NESREA, struggled unsuccessfully to get oil companies to stop flaring, but penalties imposed were too insignificant to improve operational responsibility.

Frustrated by lack of cooperation by operating companies, government continuously threaten to shut down gas flaring fields, but no field has ever been shut down, despite threats by lawmakers to take up the challenge in the face of DPR and NESREA’s apparent incapacity.

Furthermore, the imposition of fines for flaring based on prevailing gas prices ($2 per 1000 Btu last week) has not done much due to the inability of the regulators to collect the sum.

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  • Here is a conemmt I left on Chxta’s blog:Let me conemmt on the Niger Delta’s Environmental Problems and gas flaring in general.If half of the bile directed at the oil majors had instead been directed at the Alams, OBJs, Odilis, etc, perhaps the people of the Delta would have had a little breather from the perpetual flames of the gas flares. Instead, they continue screaming their guts out at Shell, Chevron, etc, when in fact it is the responsibility of the State (FG) to improve infrastructure in their poverty-stricken region, to enfore tight environmental regulations, etc. I believe the oil companies are doing exactly what other multinational companies anywhere would do – taking advantage of lax laws in a region with some of the poorest black Africans anywhere. What profit-generating company would not do the same. These are, afterall, the most nameless, faceless, voiceless people in a voiceless country. And as long as the people of the Delta continue turning out in the millions to welcome Alams, Odili, etc from prison or the drag-ball (in the case of Alams), it’s business as usual.It is not Shell’s responsibility to build houses, hospitals, roads, or to guarantee the quality of air in the oil producing regions. Indeed, it is not their responsibility to put an end to gas flaring by building gas pipelines into a country that essentially has no industrial capacity, particularly when a substantial chunk of Nigeria’s money-generating industry is faraway in Lagos. The FG is responsible for enforcing these laws, and even here in the US, when (in the early 1970s) it became clear that lead (in leaded fuels) was bad for three-way catalysts that removed unburned hydrocarbons and also could get into drinking water, the Feds enforced the laws – they did not wait around for ExxonMobil and oil companies to change their stance on leading petrol. That’s a Government. Nigeria hasn’t got one.And as for the people of the Delta, they can keep scrraeming their guts out. They’d better get used to the death, destruction and oppression they’ve been saddled with for the past 50 years. There’s plenty more where that came from, and as long as the world has its insatiable thrist for oil, it’s coming!

  • that The oil companies are right to flare off gas – it’s very cheap to do so Apparently bcauese it’s cheap makes it right for them to right? A dictator was right to commit mass murder and plunder the economy bcauese it was easy for him to? (I will resist all temptations to name you appropriately for making such a nonsensical argument) I find your line of reasoning absurd: The people of the Niger delta asked for it by welcoming Alamaesigha in their number? What has that got to do with anything?I agree that the people of the Niger Delta are responsible mostly for what is going on now The major misfortune of the Niger Delta is the failure of its present leaders and those of it’s recent past.Here are some things to consider:They were conveniently ignored during the decades of Scholarships Abroad from FG (believe me, there were a multitude of school cert holders who were willing but who had to make do with little jobs in Lagos). The culture of Looking out for your tribal brother didn’t help the idea of federalism.What I am trying to say is that the level of illiteracy in the Niger delta hasn’t been entirely without cause. Try to thinkHere is really the question I want to ask: Is it the responsibility of the Niger Delta citizens to negotiate with oil companies issues about pollution, environmental regulations?Does the government not owe that duty of care? Isn’t it the government’s duty to insist on cleaner technology? If the Niger delta is expected to take care of itself in this sense, shouldn’t it as well be self governing?I know fully well that The Federal Government will rather have the oil companies pay the fat penalty for not meeting up to standard, which also is cheaper for the company which would rather not invest in costly cleaner technology.Lastly:There are no affirmation actions or free rides to Federal universities for people of the Niger delta. No such things exist.Scholarships are being claimed and used. And the universities there are flooded with students, as badly maintained as they may be.I wish we had time for facts, numbers, so we are more empirical instead of all the unnecessary emotion.I am not denying the senselessness of the Niger delta politician( thieves all of them). Or that illiteracy is rife and poverty too. Nice breeding ground for crime, gangs etcNiger delta people need to get off their lazy asses and stop crying victim.Yar’adua needs to know what he is doing.And you need to try to understand first. W all the need to ask the right questions before we can get right answers. Else we ll all end up with wayward results.Plus Ken Saro-Wiwa was something of a literary gaint and intellectual. Many young people of the Niger Delta will join that list. You watch and see.