The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) said over the weekend that it has collected $85.1 million (more than N44 billion) in gas flare fines from petroleum companies operating in the country.
The figure represents fines incurred from January until the present.
The Commission stated that the amount of gas flared is established by sophisticated tracking and measurement devices available to it, rather than relying solely on data supplied by operating businesses, whose equipment and procedures may not measure actual gas flare for accounting and penalty purposes.
NUPRC added that the federal government’s flare gas administration should not be misconstrued as a sustainable revenue stream, as the flare fees serve as deterrents to institutionalise compliance which ultimately eliminates gas flaring, and generation of revenue from gas monetisation rather than flare payment.
“While efforts are towards flare elimination and not penalty, the commission has collected a total of $85.1m from January 2023 to date from gas flare penalty,” it stated.
The upstream petroleum industry regulator said it has sustained efforts aimed at ensuring that the Federal Government’s drive to eliminate gas flaring in the country was achieved within set timelines.
On why it cannot totally rely on data from oil and gas firms, NUPRC said:
“Organizations use different technologies and systems to measure flares according to their mandates and capacities. These include the Gas Flare Tracker system (GFT), Fiscal Grade Metre (FGM), Gas to Oil (GOR), and Material Balance which is used to measure what goes to flare. However, not all can be used to measure actual gas flare for the purpose of accounting and fines. For instance, while the GFT used by some monitoring agencies might be useful for monitoring emissions in remote areas, or for geo-locating of flare sites, it has some limitations such as cloud covering and atmospheric interference. Its accuracy range is to the tune of thousands. Even bush fires and other terrestrial fires are misconstrued by the satellite as gas flares (except where such sites are confirmed by ground
truthing), thus making the result inaccurate and unreliable”.