The Economics of Gas Flaring in Oil and Gas Processing Environments: A Case Study of Electric Power Station in a Developing Country

摘要

Gas flaring continues to pose significant threat to the environment and economy of oil and gas producing countries in particular and the globe in general. This process impacts adversely to the health and safety of the inhabitant of these countries. About 100 Billion Cubic Meters (BCM) of gas is being flared globally on annual basis with Russia and Nigeria flaring more than other countries to the tune of 35.5 and 15.2 BCM, respectively. During oil and gas processing, excess gas that is generated could be managed and beneficially harnessed by systematic channelling of the gas to the power sector where turbines utilize it to generate power. The aim of this study therefore is to investigate the production, distribution, consumption and wastage/misuse of associated gas in a typical gas-processing environment to find out the cost and effect of gas flaring. The methodology adopted to gather data involves case studies, interviews, questionnaires, artefacts and observations. The investigation site has seven gas production wells with an output of 7.2 million cubic meters per day (mmcmd). While 91.7% of this output is supplied to customers for consumption, the remaining 8.3% is controllably flared. The flared quantity increases with reduction in customers' demand and during production down time. It was found in the investigation that an average power station comprising three gas turbines and one steam turbine utilises about 3.0 mmcmd of gas to generate approximately 600-650MW of electricity. Consequently, this research proposes that with the employment of an additional gas turbine, substantial quantity of the flared gas could be sustainably used to generate power if the flaring process is properly managed.