During oil production, associated gas is produced with the oil, and this associated gas consists primarily of methane. Although this gas is often captured and utilized or conserved, some is flared because of a wide range of technical, regulatory, or economic constraints. Flares at oil production sites around the world burn approximately 145 billion cubic meters of associated gas each year, resulting in emissions to the atmosphere of more than 370 million metric tonnes of carbon dioxide equivalent (MMTCO2e). Flaring also wastes a valuable natural resource that could be used to increase energy access and advance the sustainable development of oil-producing countries. For instance, the amount of gas flared annually across the globe could power the entire African continent.
The World Bank’s “Zero Routine Flaring by 2030” Initiative catalyzes governments, oil companies, and development institutions around the world to commit to end routine gas flaring at oil production sites by 2030. Success is measured by the number of endorsers and the share of total global gas flaring the endorsers represent. As of December 2019, more than 80 governments, oil companies, and development institutions have committed to this Initiative. Endorsers account for approximately 60 percent of global gas flaring, based on 2018 gas flaring estimates.
Through this Initiative, governments and oil companies commit to:
Note: The Initiative pertains to routine flaring and not to flaring for safety reasons or non-routine flaring, which nevertheless should be minimized. Routine flaring of gas is flaring during normal oil production operations in the absence of sufficient facilities or amenable geology to re-inject the produced gas, utilize it on-site, or dispatch it to a market.
Nigeria is a prominent and noteworthy example of a country that is taking concrete and innovative action in its commitment to achieve Zero Routine Flaring by 2030. The country has embarked on a first-of-its-kind program to tackle gas flaring. The World Bank has been advising and supporting the Government of Nigeria to develop and implement its Nigeria Gas Flare Commercialisation Programme (NGFCP), which was created by the government to achieve its commitments under the “Zero Routine Flaring by 2030” Initiative.
Through the NGFCP, the Government of Nigeria is taking a comprehensive approach by commercializing the associated gas as an asset rather than an unwanted byproduct of oil production. The NGFCP will offer the associated gas for sale to third parties through a transparent and competitive bidding process.
Nigeria provides an example of how governments can take a leading role in reducing gas flaring and emissions, while adopting a market-driven approach to monetizing associated gas that otherwise would have been flared. The NGFCP is the first example of a country creating a regulatory framework enabling third parties to monetize and use flared gas.
The NGFCP contributes to Nigeria’s economic development by combining policy, regulation, guidelines, contractual arrangements, bidding processes, market intelligence, institutional capabilities, and data management to bring to market a valuable domestic natural resource. This cost-effective solution puts an otherwise wasted resource into productive use, resulting in improvements to the local environment (particularly the Niger Delta) and the communities affected by flaring.
The Programme has the potential to: