NUPRC moves to revoke idle flare gas permits

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has warned companies awarded flare gas sites that their permits could be revoked if they fail to utilise the sites or demonstrate significant progress within one year of receiving the awards.

The Commission Chief Executive, NUPRC, Mrs Oritsemeyiwa Eyesan, disclosed this during a working visit to the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, in Abuja.

Eyesan, while providing an update on the Nigerian Gas Flare Commercialisation Programme (NGFCP), said the commission was monitoring the implementation of projects awarded under the programme to ensure that investors moved beyond the award stage to actual development.

She said the regulatory framework required the commission to evaluate the performance of flare gas awardees one year after an award was granted.

“One year after an award has been granted, the Commission conducts an evaluation to determine whether there has been considerable progress,” Eyesan said.

She added that companies that failed to demonstrate sufficient progress would face regulatory action, including the possible revocation of their awards.

“Where there is insufficient progress, the Commission will take appropriate regulatory action, including revocation of the award where necessary,” she said.

The warning comes as Nigeria continues to grapple with the economic and environmental consequences of gas flaring, despite successive government policies aimed at ending the practice and commercialising associated gas.

The NGFCP was established to attract investment into the capture and commercialisation of gas that would otherwise be flared at oil production facilities.

Under the programme, investors and project developers are expected to deploy infrastructure and technologies to convert flare gas into commercially useful products, while reducing greenhouse gas emissions and other environmental impacts associated with routine flaring.

However, delays in developing awarded sites could undermine the objectives of the programme, particularly as Nigeria seeks to increase domestic gas supply for power generation, industrial production and other economic activities.

The NUPRC’s latest position indicates that the commission intends to apply stricter oversight to ensure that companies granted flare gas sites meet their development obligations.

The issue is significant given the volume of gas Nigeria continues to lose through flaring.

The World Bank’s 2026 Global Gas Flaring Tracker Report showed that Nigeria flared about 37.6 billion cubic metres (bcm) of gas between 2021 and 2025.

At an estimated value of $323 million per bcm, the gas flared during the five years was worth about $12.15 billion, equivalent to approximately N16.79 trillion.

The report ranked Nigeria as the eighth-largest gas-flaring country globally in 2025, while the country’s flaring increased by eight per cent between 2024 and 2025.

In 2025 alone, Nigeria flared about 8 bcm of gas valued at $2.59 billion.

The country’s flaring volume stood at 7.3 bcm in 2021, valued at $2.36 billion, before rising to 7.4 bcm in 2022 and 7.5 bcm in 2023. It declined slightly to 7.4 bcm in 2024 before rising to 8 bcm in 2025.

The World Bank report identified inadequate gas gathering and transportation infrastructure, insufficient capacity to bring associated gas to market and ageing gas-processing facilities as some of the factors contributing to continued gas flaring.

It also noted that Nigeria’s eight per cent increase in gas flaring in 2025 broadly tracked an approximately eight per cent increase in oil production during the same period, suggesting that the rise was largely linked to higher production rather than a deterioration in operational efficiency.

Nigeria remains Africa’s largest gas-flaring country, followed by Libya and Algeria.

Against this backdrop, the NUPRC’s decision to closely evaluate flare gas awardees could become an important test of the government’s effort to turn stranded and flared gas into productive economic assets.

For investors, the one-year performance review means that securing a flare gas site will no longer be sufficient on its own. Companies will be expected to demonstrate tangible progress towards developing the resources or risk losing their awards.