Report Shows Global Flaring Levels Down in Oil Sector

Though seven of the world’s top oil-producing countries together flared enough associated gas to power sub-Saharan Africa last year, the volume of gas flared by the oil industry fell by 5% as the coronavirus pandemic slowed demand and ultimately, oil production.

That’s according to a report released April 28 by The World Bank, which again named Russia, Iraq, Iran, the U.S., Algeria, Venezuela and Nigeria as the largest flaring countries. Combined, the countries accounted for about 40% of oil produced and about 65% of gas flared globally in 2020, according to the report based on satellite data.

Data in The World Bank’s Global Gas Flaring Tracker showed 142 billion cubic meters (Bcm) of gas was flared globally in 2020, down 5% from 150 Bcm in 2019. The decline came partly due to oil production falling to 76 million barrels per day (MMbbl/d) as the COVID-19 pandemic slowed demand. Much-needed new pipeline infrastructure also became available, providing monetization opportunities for companies looking to capture the value of natural gas.

“These silver linings, against the backdrop of a dark year, give us hope that progress on gas flaring reduction will accelerate, particularly for those with the appropriate infrastructure, regulation and political will in place,” Zubin Bamji, program manager of the World Bank’s Global Gas Flaring Reduction Partnership World Bank, wrote in the report. “For our part, we will redouble our efforts to collaborate with high gas flaring countries, particularly in developing countries, and work closely with governments and oil companies to address the most common challenges to gas flaring reduction.”

The U.S. was among the bright spots. The report showed gas flaring in the U.S.—mainly in the Permian Basin, Bakken and Eagle Ford—dropped by 32%, accounting for 5.5 Bcm or 70% of the overall drop in global gas flaring. Besides the oil production slowdown, the improvement was attributed to more gas infrastructure and takeaway capacity.

Regulators have also been taking steps to reduce emissions. New Mexico authorities passed rules earlier this year that require upstream and midstream operators to capture 98% of natural gas waste by year-end 2026.

RELATED

New Mexico Takes ‘Bold Action’ on Natural Gas Flaring

Permian Basin Flaring Returns to Spotlight as Environmental Pressure Grows

Pioneer’s Sheffield: Focus Remains on Permian Basin Flaring

Nigeria is also gaining ground in its efforts to reduce gas flaring volumes.

“Although the country has remained in the top seven flaring countries, it has nonetheless steadily reduced its flaring by some 70% over the past 15 years,” the report said of Nigeria. “Flaring has declined from over 25 Bcm in 2000 to close to 7 Bcm in 2020, while oil production has remained essentially flat at around 2 million barrels a day.”

Russia, however, remains the world’s top gas-flaring country based on the report, which showed the volume here rose to 24.88 Bcm in 2020 from 23.21 in 2019. Still, the narrative is changing in parts of the country, including the Khanty-Mansi Autonomous Okrug (KMAO) region where the report showed gas flaring has fallen by 80% since the mid-2000s. KMAO gas flaring volumes were down to just over 4 Bcm in 2020, according to the report.

Surgutneftegaz was the most successful in bringing down emissions, having an associated petroleum gas utilization rate of 99.5% last year, Reuters reported April 9 citing a Russian document. Gazprom had 98.9%, while Rosneft stood at 73.1%.

The World Bank said its report utilized data from satellites operated by the U.S. National Oceanic and Atmospheric Administration and interpreted with assistance from the Colorado School of Mines’ Payne Institute for Public Policy.

The organization also released a new metric called the Imported Flare Gas Index (IFG Index), that “aims to quantify the concept that if a country is importing crude oil from producing countries then it is also importing the flaring intensity of these producing countries in proportion to the amount of crude oil imported.” The index identifies countries with indirect exposure to gas flaring via their large oil import volumes.

“Eliminating routine gas flaring is common sense because any action to reduce flaring profoundly reduces the direct or Scope 1 emissions of the oil and gas sector,” the report stated. “In this sense, it is what we call a ‘low-hanging fruit,’ alongside other climate actions, like preventing and minimizing methane leaks, and eliminating routine venting. While there are certainly barriers and constraints, ending routine gas flaring represents a big ‘win’ for climate action.”