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Gas flare commercialisation: Economic gains for all, breath of fresh air for communities and oil firms
By Akpandem James
For decades, the sight of roaring flames lighting up the night sky in Nigeria’s Niger Delta has been both a symbol of oil wealth and a reminder of environmental neglect. Gas flaring, long treated as an unavoidable by-product of crude oil production, has inflicted deep scars on host communities, degraded ecosystems, endangered public health and strained relations between oil producers and their hosts. Over time, these tensions contributed significantly to operational disruptions, community unrest and the eventual decision by some international oil companies to divest from onshore oil production in the region.
At the heart of this long-standing conflict lies environmental degradation, with gas flaring as one of its most visible and damaging manifestations. Beyond the obvious pollution of air, soil and water, flaring has been linked to respiratory illnesses, acid rain and heightened safety risks for communities living near oil facilities. For Nigeria, whose economy depends heavily on hydrocarbon revenues for foreign exchange earnings, the consequences extended beyond the Niger Delta, affecting national output, investor confidence and energy security.
These challenges formed part of the critical concerns addressed by the Petroleum Industry Act (PIA) 2021, a landmark reform that redefined the regulatory and commercial framework of Nigeria’s petroleum sector. Sections 104 to 108 of the Act introduced a comprehensive regime for prohibiting, penalising, measuring, managing and ultimately eliminating the flaring of natural gas during petroleum operations. This marked a decisive break from the Associated Gas Re-injection Act (AGRA) of 1979, which had permitted routine flaring with ministerial approval once operators submitted gas re-injection plans.
In practice, the old regime inadvertently encouraged flaring. Penalties for non-compliance were relatively low and often cheaper for operators than investing in gas utilisation infrastructure. The result was decades of routine flaring, with enormous environmental costs and lost economic value. The PIA reversed this logic by making flaring increasingly unattractive while creating clear incentives for gas capture and utilisation. It also streamlined milestone approvals for gas flare elimination facilities, ranging from concept design and front-end engineering design to detailed engineering approvals and final permits to operate, thus providing regulatory clarity and predictability for investors.
With the coming into effect of the PIA in August 2021 and the subsequent inauguration of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in October 2021, Nigeria’s foremost upstream regulator, decisive steps were taken to confront what had become an Achilles heel of the petroleum sector. Central to this effort were clear regulatory guidelines and the relaunch of the Nigerian Gas Flare Commercialisation Programme (NGFCP) in September 2022.
The NGFCP was conceived as a market-driven solution to a decades-old environmental and economic problem. Its core objective is to transform flare gas from a long-standing liability into a valuable economic asset capable of driving industrial growth, strengthening energy security and significantly improving the sector’s environmental credentials. Rather than viewing flared gas as waste, the programme treats it as feedstock for power generation, LPG, petrochemicals and other gas-based industries.
According to the Commission Chief Executive, Engr. Gbenga Komolafe, the ambition is nothing short of transformational. “The target was to end a decades-long challenge and replace it with a wealth-generating, climate-positive opportunity,” he said. By allocating flare sites to competent third-party developers through a transparent and competitive process, Nigeria has activated what he describes as a globally innovative commercial model—one in which waste is converted into value and environmental challenges give way to investment opportunities.
The scale of the programme is significant. The NGFCP targets 49 flare sites across land, swamp and shallow offshore terrains, with aggregate flare volumes estimated at between 250 and 300 million standard cubic feet of gas per day by 2027. Individual sites range from 0.5 to 30 mmscf/d, offering opportunities for both small modular projects and larger gas utilisation schemes. Supported by the fiscal incentives embedded in the PIA, the programme is expected to attract up to $7.2 billion in investment capital while delivering annual emissions reductions of between six and seven million tonnes of CO₂ equivalent.
Beyond climate benefits, the economic implications are far-reaching. Increased gas supply into the domestic market will deepen in-country value addition, stimulate gas-based industrialisation and reduce reliance on imported fuels. For host communities in the Niger Delta, the programme promises cleaner air, new infrastructure, employment opportunities and enhanced social development. For oil producers, it offers relief from flare penalties, reduced environmental and operational liabilities and improved environmental, social and governance (ESG) performance—an increasingly important factor in global investment decisions.
The NGFCP also aligns fully with Nigeria’s Energy Transition Plan (ETP) and its Nationally Determined Contributions under global climate frameworks. As noted by Engr. Komolafe, the programme is not merely a policy initiative but a core pillar in Nigeria’s effort to eliminate routine flaring, reduce greenhouse gas emissions and enhance the country’s credibility in international energy transition commitments.
Progress under the programme has been steady. To date, 28 frontline NGFCP awardees have been issued final permits to access flare gas, marking a critical transition from planning to implementation. The programme itself has been structured in three phases: the bidding process, which began in 2023 and culminated in the announcement of 42 awardees in September of that year; a negotiation phase in 2024 covering technical, commercial and contractual terms, followed by permit issuance in 2025; and a final execution phase, scheduled to commence in 2026, aimed at delivering actual flare-out projects.
This transition was formally underscored on Friday, December 12, when the NUPRC issued Permits to Access Flare Gas (PAFG) under the 2022 NGFCP. Presiding over the ceremony, Engr. Komolafe described the event as a milestone achievement for Nigeria’s upstream sector, a strategic inflection point signalling the shift from legacy challenges to market-driven solutions that unlock economic opportunities, strengthen energy security, reduce emissions and improve operational efficiency across the industry.
More importantly, the issuance of permits marked the end of commercial negotiations and the beginning of real project execution. It signalled a fundamental change in how flare gas is perceived, not as waste or an environmental burden, but as a commercially viable resource capable of driving industrial growth and national prosperity. In regulatory terms, it represented a decisive move from policy design and bidding to tangible implementation under the NGFCP.
The achievements recorded so far are notable. The programme has awarded 49 flare sites across three terrains to 42 bidders, attracted an estimated $2 billion in foreign direct investment for gas development projects and placed Nigeria as a pioneer in structured flare gas commercialisation. It has also created a fast track towards fulfilling the Presidential mandate of deepening domestic gas utilisation while enhancing local participation in the sector.
Recognising that success depends on effective delivery, the NUPRC has established continuous support mechanisms for permit holders. These include streamlined regulatory approvals, hands-on guidance through a dedicated NGFCP Project Management Office, facilitation of access to financing, including carbon finance in collaboration with development partners, and sustained advocacy for international support.
However, the responsibilities are clearly shared. Producers are obligated to deliver flare gas in line with agreed quantities and quality, ensure accurate metering and transparent reporting, provide safe access to flare sites and align host community engagements with permit holders. Permit holders, on their part, must design, finance, build and operate gas gathering and utilisation facilities to approved technical and safety standards, meet flare-out milestones, maintain robust health, safety and environmental systems, and manage fair relationships with host communities.
Once projects commence, routine gas flaring is expected to cease, except in limited emergency situations expressly permitted by regulation. The ultimate expectation is clear: visible projects on the ground that convert flare stacks into engines of economic value.
If fully implemented, gas flare commercialisation under the NGFCP will stand as one of the most consequential reforms in Nigeria’s upstream petroleum sector. It offers a compelling example of how environmental responsibility can be aligned with economic growth, delivering cleaner air for communities, operational relief for oil firms and sustainable value for the national economy. In extinguishing the flames of routine flaring, Nigeria may well be lighting the path to a more resilient, inclusive and climate-conscious energy future.
- Akpandem James is a Fellow of the Nigerian Guild of Editors and member Governing Board of the Nigerian Institute of Journalists, Lagos
The echoes of the drums rolled out to celebrate the rescue of the 44 teachers and students, kidnapped from some schools in Oyo State, after 56 days in the bush, would surely be disrupted abruptly, with the divergent echoes of a fresh abduction, this time coming from Kogi State.
Reports indicate that the gunmen, struck on Tuesday at the Government Secondary School, Odo-Ekina, in Dekina Local Government Area of the state, abducting four students, the school principal and a National Examinations Council (NECO) ad hoc staff member.
Authorities of the Kogi State Police Command, who immediately unleashed their operatives in hot pursuit of the abductors, said the attack occurred at about 5:25 p.m. while the students were writing their NECO examination.
Saliu Oyiza Afusat, an Assistant Superintendent of Police (ASP) and spokesman of the command, said a combined team of police personnel and other security agencies has launched a search-and-rescue operation following the incident.
Informing that one of the students was actually rescued immediately, she said efforts were ongoing to secure the release of the remaining victims and apprehend the attackers, adding that Naziru Bello Kankarofi, the state Commissioner of Police, alongside the Brigade Commander and the State Security Adviser to the Governor, Commodore Jerry Omodara (Rtd), were already on the way to the scene for an on-the-spot assessment.
Oil prices are expected to go down now with the announcement of Donald Trump, US President that he will no longer impose a 20 percent “safe passage” fee on ships passing through the Strait of Hormuz.
The POTUS, hinged his reversal of the decision on the intervention from some Gulf countries, who pleaded with him not to toe the line due to the massive economic impact the decision would make on the region.
Indeed, oil prices had shot up immediately Trump announced the new levy on Monday while declaring the US ‘the guardians of the Hormuz strait,’ a measure which he said was to pay for the cost of guarding the volatile area in order keep supply of oil flowing.
Reports said that Gulf allies of the US worked frantically to get Trump on the phone in time to talk him out of the idea altogether, while a flurry of appeals came from Saudi Arabia, the United Arab Emirates, Bahrain and Qatar.
In response, the POTUS, posting on his Truth Social platform, wrote: “Based on highly productive conversations with Middle East leadership, I have decided to replace the 20% United States Reimbursement Fee with Trade and Investment Deals that the various Gulf States will be making into the United States.”
Trump, who said the investments would be “MASSIVE but, at the same time, extraordinarily good for them, and their future,” added that the deals would see factories, plants, and equipment pour into the US at “Historic levels.”
The Gulf nations have committed to invest trillions of dollars in the US, though it remains unclear how much of that they will actually spend over the next several years.
Meanwhile, the US continues to bomb Iran in what appears to be a resumption of active conflict between both countries, despite an ongoing roadmap to end the conflict.
Reports say operatives of the Osun State Police Command, and those of the Department of State Services (DSS) had tracking the trail of Adeniyi Adeyemi, controversial Director General of the Presidential Foreign Intervention Promotion Council (PFIPC), for weeks, before he was eventually pulled out of his hole on Tuesday.
However, the duo, were said to have pulled back after failing to track him through his mobile phones, which he had reportedly switched off for about two days, making it difficult to locate him, leaving the stage for the members of the Police Intelligence Response Team (PI-RT) led by Moses Lohor, a Chief Superintendent of Police (CSP).
Lohor, said to have previously served as the Commander of the Anti-Kidnapping Squad of Osun State, and reported to have been involved in high-profile security operations and controversies, after taken over fielded his men to pick up signals from their well-oiled signal networks.
Regarded by many Osun residents as one of the key security officers who contributed significantly to the peace and stability enjoyed in Ilesa and other parts of the state during his tenure, he was said to have relied on his contacts before his transfer out of the state, said to have raised concerns from the public about the security situation he would be leaving behind.
His exit from the state was said to be hinged on an incident in 2024, in which he allegedly shot one Iyanda Alowonle, then Chairman of Osun State Motor Transport System, in the stomach at the police station in the state prompting an order for his arrest by then Inspector General of Police (IGP).
His effort was said to have paid off when he successfully tracked down the controversial PFIPC, boss, who was seen on Tuesday evening, in a shot video on social media undergoing interrogation, and eventually handed him over to Ibrahim Gotan, Commissioner of Police in the state.
The PUNCH quoted one of the sources as saying: “The arrest (of Adeyemi) took place on Tuesday morning by the IRT squad, who immediately moved him to Abuja. After he was arrested, he was taken to Ibadan and from there to Abuja.”
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