Penalties, corruption and legislation fail to deter harmful gas fracking in Nigeria, study shows

Legislation is failing to stop gas flaring in Nigeria which is harming the environment and people’s health, a new study warns.

Legal penalties for oil companies are ineffective and are not weighty enough to act as a deterrent, making it cheaper and easier to pollute the air and water.

An expert has warned of loopholes in the legislation which gives the government discretionary powers to grant permits for gas flaring, corruption and could be abused by the oil companies.

Today, Nigeria contributes significantly to the total amount of greenhouse gases produced in Africa through emissions from the oil and gas industry in the Niger Delta.

The study, conducted by Dr Urenmisan Afinotan of the University of Exeter Law School, shows how efforts to stop gas flaring in the Niger Delta from the 1960s to the present day have been superficial because they include weak penalties, practical loopholes and granting wide discretion to the oil minister and appears to be driven by financial gains and not climate considerations.

Legal attempts to combat climate change by stopping gas flaring have produced better results. However, the judicial attitude of the courts in Nigeria still appears to favor the economic interests of the government over climate change.

Nigeria has legislative, regulatory and legal measures in place to achieve its international commitments to combat and mitigate climate change. But until very recently, there was no specific legal framework covering climate change in Nigeria. The recently enacted Nigeria Climate Change Act (December 2021) is still too new to assess its effectiveness in mitigating climate change in Nigeria.

Gas flares are produced when the extra gases from crude oil drilling and production processes are burned off in the atmosphere. Nigeria is a significant contributor to about 65 percent of the total amount of gas flared globally and flares about 60 percent of the associated gas, effectively placing it as the country with the worst gas flaring record in the world.

There have been a few regulatory attempts to stop gas flaring in Niger Delta communities since 1969. Most recently, the Petroleum Industry Act (PIA), 2021, said oil companies with oil exploration licenses and leases should submit a viable feasibility study for associated gas exploitation within five years of commencement . This failed to discourage gas flaring prior to the preparation of the feasibility study or impose penalties for gas flaring before and after submission of the study. This always meant that the oil companies were free to flare gas, without penalty, for five years.

The Associated Gas Re-Injection Act (AGRA) gives the petroleum minister discretion to allow flaring of gas where they believe re-injection or utilization of the gas is impossible. This left the door open for the oil companies to corruptly obtain permits and licenses for gas flaring.

The Associated Gas Re-Injection (Continued Flaring of Gas) Regulations (AGRA Regulations) allowed gas flaring under certain conditions and prescribed absurdly low fines that made it more economically viable for oil companies to flare associated gas rather than re-inject or exploit it. These conditions or exemptions automatically exempted about 86 of a possible 155 oil fields owned by the multinational oil companies from regulations or penalties. The AGRA regulations had no impact on the cessation of gas flaring and the utilization or reinjection of gas.

Although it has been reported that the proportion of gas flared in Nigeria has decreased since 2002 and now stands at 10 percent as of 2018, there are reports of new gas flaring sites being built by oil companies such as Shell, in oil fields in the Niger Delta since 2013.

Nigeria’s new National Gas Policy (NGP) aimed to end gas flaring by the year 2030. Associated regulation provides a legal framework for protecting Niger Delta communities and the wider Nigerian environment from the harmful effects of gas flaring and climate change. It also has the potential to help achieve social and economic benefits from associated gas that would normally be flared and wasted during oil production. The regulations authorize the federal government to appropriate all flare gas held by oil producing companies that hold licenses for oil exploration, leases and marginal fields.

Dr Afinotan said: “A new gas flaring commercialization plan can drastically reduce gas flaring in the Niger Delta and generate gas revenue for the Federal Government.

“It is worrying that the discretionary power the Minister has to grant permits to oil companies to flare gas, as it was present in AGRA, is also retained in the Flare Gas Regulations 2018. Such discretionary powers are capable of being corrupted or exploited by the oil companies with their financial power and influence, to obtain permits from the minister using their discretionary powers.

“Only time will tell, especially when the courts are asked to interpret the provisions of the ordinance. Gas flaring is still a daily occurrence in the Niger Delta.”

The Petroleum Industry Act – passed into law in August 2021 after more than a decade of legislative stalling – does not outright ban gas flaring, but requires oilfield operators to submit a “natural gas flaring elimination and monetization plan” within 12 months of securing a license to operate. Gas flaring is still permitted, albeit under certain conditions. This has been seen as another half-hearted attempt to stop gas flaring in Nigeria.

The study analyzes recent oil-related cases heard by the Nigerian judiciary that have prioritized the economic benefits and interests of the harmful oil and gas industry over the negative effects the industry has on the environment and the lives of the residents of the host communities.

More information:
Urenmisan Afinotan, How serious is Nigeria about mitigating climate change through gas flaring regulation in the Niger Delta?, Environmental law review (2022). DOI: 10.1177/14614529221137142

Provided by the University of Exeter

Citation: Penalties, corruption and legislation fail to deter harmful gas flaring in Nigeria, study finds (2022, December 23) retrieved on December 25, 2022 from deter – gas.html

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