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World Bank: Oil Producing Countries, Companies Can Help Mitigate Impact of Climate Change by Reducing Gas Flaring

The 150 billion cubic meters flared and vented annually are equivalent to 25 per cent of the United States’ gas consumption per year, and release about 390 million tons of CO2 into the atmosphere
Press Release No:2006/137/SDN

 

In Washington:

Mauricio Rios (202) 458-2458

mrios@worldbank.org

Hannfried von Hindenburg  (202) 458-5613

hvonhindenburg@ifc.com

 

WASHINGTON, D.C., November 10, 2006 — The World Bank’s Global Gas Flaring Reduction partnership (GGFR) today called on oil producing countries and companies to reduce the burning of natural gas as a way of mitigating the impact of climate change and reducing greenhouse gas emissions. It is estimated that global gas flaring releases about 390 million tons of CO2 per year into the atmosphere.

 

Flaring gas has a global impact on climate change by adding about 390 million tons of CO2 in annual emissions. This is more than the potential yearly emission reductions from projects currently submitted under the Kyoto mechanisms.

 

“Reducing gas flaring around the world contributes to mitigating the impact of climate change, and so it is critical that high flaring countries such as Russia, Iran, Iraq, Venezuela, Brazil and Mexico join the efforts of flaring reduction if we want to have a bigger impact,” said Rashad Kaldany, Director of the Oil, Gas, Mining and Chemicals Department at the World Bank Group, during a press briefing today. Kaldany is also the Chairman of the GGFR Steering Committee, a public-private partnership of governments, state-owned companies and major international oil companies committed to reducing flaring and venting worldwide.

 

Gas flaring wastes resources and harms the environment. It also deprives consumers of an energy source that is cleaner and often cheaper than others available, and reduces potential tax revenue and trade opportunities, Kaldany explained.

 

The World Bank’s GGFR estimates that 150 billion cubic meters (or 5.3 trillion cubic feet) of natural gas are being flared and vented annually.  That is equivalent to 25 per cent of the United States’ gas consumption or 30 per cent of the European Union’s gas consumption per year. And the annual 40 bcm (or 1.4 trillion cubic feet) of gas flared in Africa alone is equivalent to half of that continent’s power consumption.

 

Given the crucial role that GGFR can play in fostering effective emission reductions from the oil and gas sector, the World Bank is organizing a Global Forum on Flaring Reduction and Gas Utilization to be held in Paris on December 13-15.

 

“Reducing gas flaring requires a global and concerted effort by governments and industry, as well as financial institutions and local communities,” says Bent Svensson, manager of the GGFR.  “Gas flaring reduction has been most successful where there is country buy-in, high-level support and an effective local partnership between government and industry.”

 

The GGFR partnership facilitates and supports national efforts to use the associated gas that comes with oil production and thus reduce flaring, by tackling the lack of effective regulatory frameworks and the constraints on gas utilization, such as insufficient infrastructure and poor access to local and international energy markets, particularly in developing countries.

 

The GGFR work program focuses on four key areas to overcome the barriers to gas flaring reduction: commercialization of associated gas; regulations for associated gas; implementation of the global flaring and venting reduction standard; capacity building to obtain carbon credits for flaring and venting reduction projects.

 

In 2005 and 2006, the G8 joint statements at Gleneagles and St Petersburg, respectively, supported GGFR’s mission and called for its work program to be extended beyond 2006. There is broad acceptance of the global flaring and venting Standard introduced by the partnership, and the collaborative approach it encourages.

 

The top 20 major flaring countries in the world include: Nigeria, Russia, Iran, Iraq, Angola, Qatar, Algeria, Venezuela, Equatorial Guinea, Indonesia, Azerbaijan, Kazakhstan, Libya, Equatorial Guinea, Brazil, Mexico, the United States, Canada, and the United Kingdom.  Developing countries account for more than 85 percent of gas flaring and venting.

 

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