By Adewale Sanyaolu
Indigenous oil and gas producer, Millennium Oil and Gas Company Limited (MOGOL) has announced plans to harness flared gas at Oza marginal in Abia State for the production of electricity.
The move by the company is a significant move to grow electricity generation to boost industrial and commercial activities in the State.
Part of the deal has also seen the company enter into a collaborative arrangement with American energy solutions provider, Saltspring Energy LLC, to decarbonise operations at the Oza oilfield.
Millennium Oil is a Nigerian based exploration and production company which operates the Oza marginal oilfield hosted in the Oil Mining Lease OML 11 while Saltspring Energy LLC, based in Houston, Texas, United States, is a global energy solutions provider specializing in carbon management.
In a joint statement issued in Lagos and Houston, the companies declared that they have reached a memorandum of understanding (MoU) to collaborate on a groundbreaking initiative to cut carbon emissions by converting flare gas to power production.
Executive Chairman of MOGOL, Mrs. Cecelia Umoren, said: “This partnership represents a significant step forward in addressing one of the major environmental challenges in the oil and gas sector – gas flaring.”
By collaborating with SaltSpring, we are not only reducing emissions but also creating new revenue opportunities and positioning ourselves at the forefront of the energy transition,” she explained.
Under the partnership, the two companies would develop and implement a carbon credit mechanism based on the existing Gas Sale and Purchase Agreement (GSPA) for the Oza Field, curb gas flaring and associated environmental challenges, and generate carbon credits under established global standards.
The earned carbon credits could now be sold on global platforms like Verra, Gold Standard, and the European Union Emissions Trading System (EU ETS).
In delivering on the objectives of the partnership, SaltSpring commits to assist MOGCL in creating a verified carbon credit mechanism that aligns with global sustainability goals and carbon-neutral certification standards.
The American company would also deploy its expertise in assisting MOGCL tradethe generated carbon credits and open new revenue streams while strengthening its sustainability profile.
SaltSpring is to also guide MOGCL through the certification process, ensuring that all carbon credits adhere to the standards set by recognized certifying bodies such as Verra and Gold Standard.
The MOU holds that the profits from the sale of carbon credits would be shared equally between MOGCL and SaltSpring Energy, creating a long-term partnership that benefits both parties while contributing to global emission reduction efforts.³33.
Recall that the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) recently , announced that it was targeting the monetisation of 50 per cent flared gas in the country through the Nigerian Gas Flare Commercialisation Programme (NGFCP).
Speaking when the leadership of the Human and Environmental Development Agenda (HEDA) visited him in his Abuja office, the Chief Executive of the commission, Gbenga Komolafe, stated that Nigeria has already achieved 60 per cent fugitive methane emission reduction target from oil and gas for the first time.
“Nevertheless, the federal government has declared gas as our transition fuel and the commission has so far made successful moves at converting flared gas into commercial gains.
Recently we offered 49 flare sites to preferred winners to monetise the flared gas and eliminate gas flaring.
Also in pursuit of its investment promotion and value creation in the industry, the commission has pursued the NGFCP, accounting for the monetisation of approximately 50 per cent of gas currently being flared towards achieving Net Zero target.
It has already achieved 60 per cent fugitive methane emission reduction target from Oil and Gas for the first time based on robust data provided by the NUPRC and has engaged the International Finance Corporation regarding opportunities surrounding Carbon Capture Utilisation and Storage (CCUS),” he stated.