A new report estimates flaring of unused gas wastes about 5% of the world's annual production while emitting 400 million metric tonnes of CO2 per year. GE's Flare Gas Reduction: Recent Global Trends and Policy Considerations report estimates the 5% wastage via flaring is an amount equivalent to 30% of consumption in the European Union and 23% in the United States. As for the CO2 emissions, the report estimates that the 400 million tonnes of CO2 annually is equivalent to 77 million automobiles.
The report estimates flaring in the Russian Federation accounts for as much as 50bcm of natural gas. If half of this flared gas was captured and sold at prevailing domestic prices in Russia, the economic opportunity may exceed $2 billion, the report says. Modest policy efforts and greater emphasis on investments in power generation and gas processing technologies could make a difference, the report says.
Nigeria has led the way by reducing flaring by 28% from 2000 levels, but the industry still wastes 15bcm per year of natural gas. Capture and flare gas use could potentially triple per capita electricity consumption for Nigeria, the report suggests. The rest of West Africa flares about 10bcm/year of natural gas.
Low natural gas prices and higher costs related to capturing flare gas in the Middle East encourage the wasteful burning of unused gas.
Operators sometimes flare unwanted gas that is produced while extracting oil; sometimes they re-inject the gas to maintain reservoir pressure. When infrastructure is in place, the operators produce the gas to export pipelines or use the gas. Another solution is power generation. Nearly $20 billion in wasted natural gas could be used to generate electricity, the report suggests.
The report proposes a multi-tiered approach at reducing flaring, starting with strengthened international commitments, moving into advancing local solutions and finally increasing access to financing.
Internationally, the report says efforts should include punitive actions and incentives to encourage investment. At the local level, governments, producers and technology providers must cooperate to communicate the value of gas, highlight the financial benefits of reducing flaring, secure support for monitoring and enforcing flaring regulations build capacity that helps local investors and contractors develop, operate and service distributed power generation. OE
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