Gas Flaring and its Implication for Environmental Accounting in Nigeria

Ayoola Tajudeen John

doi:10.5539/jsd.v4n5p244

Abstract

The study examines the theoretical framework for gas flaring and its implication for environmental accounting in the Nigerian Petroleum Industry. Data were sourced from the annual reports of companies involved in gas flaring in the oil and gas industry and the result reveals that the issue plaguing environmental accounting disclosures relate to lack of a standardized requirement for disclosure, political will for legislation, enforcement and the allocation of environmental costs, therefore, the study recommends the development of an integrated corporate environmental policy with legal backing that will streamline environmental information disclosures in annual accounts

Highlights

Nigeria’s proven natural gas reserves are estimated at 174 trillion cubic feet(cf), with energy content slightly greater than the country’s oil reserves, at existing rates of production, oil reserves should last for another 37 years while gas reserves should hold out for 110 years at least
According to a World Bank sponsored study, gas flaring is one such anthropogenic activity that is defined as the “wasteful emission of greenhouse gases (GHGs) that causes global warming, disequilibrium of the earth, unpredictable weather changes and major natural disasters because it emits a cocktail of benzene and other toxic substances that are harmful to humans, animals, plants and the entire physical environment
The primary purpose of this paper is to examine the theoretical framework for gas flaring and its implication for environmental accounting

Summary

Introduction

Nigeria’s proven natural gas reserves are estimated at 174 trillion cubic feet(cf), with energy content slightly greater than the country’s oil reserves, at existing rates of production, oil reserves should last for another 37 years while gas reserves should hold out for 110 years at least. This statistics demonstrates the fact that the nation is a gas rich economy; out of the 5.78mm cf of gas produced per day, 80% of it is flared while 12% is re-injected to enhance oil production. Gaseous hydrocarbons react with atmospheric oxygen to form carbon dioxide (co2) which in addition to other GHGs are responsible for changes in global climate that are resulting in increasingly frequent and intense natural disasters and the spread to temperate regions of diseases once found only in the tropics

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