Chevron moves to curb Nigeria gas flares
Copyright 2000, United Press International
September 9, 2000
Chevron Friday announced the next stage of its program to capture and put to use more of the natural gas produced by its oil drilling activities in Nigeria that is currently being burned off as waste.
The $2 billion third stage of the Escravos Gas Project announced in New York includes plans for construction of a plant that will capture some 400 million cubic feet per day of gas that is currently burned off in the Escravos oil field and then turned into a feedstock — a raw material — for a gas-to-liquid plant that will produce clean-burning liquid fuels to be sold in Europe.
The program, which also involves Nigeria National Petroleum Corp., is aimed at reducing the impact that round-the-clock gas flaring has on the environment in the Niger Delta while turning gas that has been a by-product of oil drilling into a marketable commodity
"The gas projects are an integral part of Chevron's growth plans in Nigeria," Chevron CEO Dave O'Reilly said. "We are also excited about this initiative because of its double environmental benefits. First, we're putting out flares from our Nigeria operations, which will bring about a reduction in greenhouse gas emissions, and secondly, gas-to-liquids products are expected to set new global standards for premium high-performance, environmentally-friendly fuels."
Nigeria has the world's eighth-largest natural gas reserves, most of which is found in the same geological formations as Nigeria's plentiful crude oil deposits. While gas associated with oil wells in other parts of the world is often pumped back into the ground or used as a fuel, Nigeria has a relatively small domestic market for gas and its geology does not lend itself to re-injection.
The U.S. Energy Information Administration has estimated that some 75-percent of Nigeria's gas is burned off by flaring, although the government has mandated that most flaring be eliminated by 2008.
The smoke and billowing flames of Nigeria's gas flares has been a source of criticism from the world environmental community for several years due to their impact on the air quality in the fragile Niger Delta. They have also been representative of what critics have viewed as a perceived symbol of a too-cozy agreement between international oil companies and a Nigerian government willing to forego environmental protection in favor of oil profits.
Chevron and Royal Dutch Shell have in recent years launched separate programs to build processing plants that will capture gas for use in the West Africa region's small, but growing domestic market.
Shell opened a $3.8 billion liquefied natural gas plant last year that condenses gas to a liquid that can be exported by tanker; Shell said it supplies 95 percent of Nigeria's domestic gas needs and still has plenty left over.
Chevron began its program to reduce flaring in Escravos in 1997 with the first phase of the Escravos Gas Project, which utilized about 150 million cubic feet per day. The second phase will come on-line later this year and raise the project's capacity to around 300 million cubic feet per day.