Why Multinational Firms Flout Gas-Flaring Laws In Nigeria — Senate

Experts: oil firms in Nigeria find it more ‘economical’ to flare gas

Chairman, Senate Committee on Gas, Bassey Akpan, has expressed concern that multinational companies due to limited legislation are flouting the law on gas flaring in the country. According to Akpan, a recent study has shown that there is an increase of about 36.8 percent of cooking gas usage in Nigeria in the last three years, while over 80 percent of Nigerian household still relies on kerosene, firewood and dangerous energy sources.

He said the committee would put in place strong and effective legal framework to sanction erring multinational companies to act as deterrence to others.

BusinessDay report continues:

Speaking during the inaugural meeting of the Committee on Wednesday, Akpan said the laws were being violated due to excessive ministerial permissions and the position of the Nigerian National Petroleum Corporation (NNPC).

Experts say oil firms in Nigeria find it more ‘economical’ to flare gas and pay insignificant fine than to re-inject that gas back into oil wells because there is insufficient energy market, especially in rural areas.

The lawmaker said the Committee would critically look into the economic, health and environmental degradation of the oil producing communities caused by the continuous gas flaring.

“Despite the various policy regulating the sector, routine gas flaring still continues, companies are even more satisfied paying penalties and the mechanism available to government to curb these irregularities are not fully utilized due to excessive ministerial permissions, limited legislation and the incontrovertible position of NNPC in the joint ventures,” he said.

The Committee, he assured, will explore legal and institutional frameworks for oil and gas operations in Nigeria towards devising a strategic document that will complement existing gas policies.

The Committee will ensure that the Federal Government agenda of encouraging more Nigerians to embrace the usage of Liquefied Petroleum Gas, which is clean, safe and affordable is achieved, he said.