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Nigeria: Shell Budgets $1.55b To End Gas Flare

The announcement came after a court ordered it to stop gas flare in Iwherekan, Delta State by April 2007. The company did not comment on the ruling but said the money would be used to capture gas being burnt up from 28 of its 75 flow-stations. This development emerged as the World Bank Board approved a $10 million grant from the Global Environment Facility (GEF) for Nigeria to manage its ecosystem.The project would provide a framework for addressing poverty reduction and the sustainable management of Fadama ecosystems vulnerable to land use changes and agricultural practices.
Shell, on its own, pledged to end gas flaring in its Nigeria operations in 2009. The $1.55 billion would enable it “gather and bring to market gas from more than 1,000 wells, which is a big undertaking”.It said it has made a “significant” investment of $2.3 billion “to develop major associated gas gathering projects to collect gas from our fields scattered across the Niger Delta”. In its view, the zero target date of 2008 set by the government is not feasible because of inadequate funding of gas projects. Shell explained in a statement that “we are yet to receive the text of the judgment, so we cannot comment on it. However, we understand that the … court has granted our motion for a stay of execution of the judgment whilst our appeals before the Federal Court of Appeal are in progress ….
“Over the last five years, a significant investment (of $2.3 billion) has been made by the Joint Venture to develop major associated gas gathering projects to collect gas from our fields scattered across the Niger Delta”. World Bank Task Team Leader of the ecosystem project, Simeon Ehui, said the GEF would finance six of the 18 states participating in it. The amount would be used to enhance the productivity of Fadama areas – which include Borno, Jigawa, Katsina, Kogi, Kwara and Plateau States – and support community needs through sustainable land use and water management.
Ehui said the project would also help to develop the capacity for natural resource management as well as establish an integrated ecosystem management in selected watersheds through the management of key forest areas, buffer zones and wetlands, and improve water management. At least 60 per cent of the states would have established sustainable watershed management co-ordination capacity and sustainable land and water management practices at the end of the project.
This would be the mainstream of the local development plans in at least 35 per cent of the participating communities. Poverty in Nigeria is widespread and a complex challenge, while the contribution of the oil and gas sector to the economy is quite significant. Benefits often do not reach the majority of the population and in particular the rural poor. Agriculture remains a key vehicle with which to achieve the government’s goals of reducing poverty in rural areas.
Source : Daily Independent (Nigeria)

Posted Date: 
14 April 2006 - 3:47am