Potential reductions in global gas flaring for determining the optimal sizing of gas-to-wire (GTW) process: An inverse DEA approach

Abstract

Routine gas flaring in oil producing nations is one of the top environmental challenges that must be addressed for improving sustainability measures across the petroleum industry. How can we accurately estimate potential reductions in gas flaring? This paper describes an extended inverse data envelopment analysis (DEA) model for estimating potential reductions in global gas flaring. The potential reductions are needed for the conversion of flared gas to electricity via the gas-to-wire (GTW) process. In this connection, the optimal sizing of the GTW process depends on the potential reductions and the annual gas usage requirement of turbines. The proposed methodology in this paper was applied to the situation in member nations of the organization of the petroleum exporting countries (OPEC). Initial results revealed that six nations were inefficient oil producers, indicating that there is ample room for reduction in gas flaring. The main results showed that the maximum potential reductions in gas flaring for Algeria, Indonesia, Iraq, Nigeria, UAE, and Venezuela are 83.11%, 78.35%, 91.62%, 91.24%, 55.76% and 95.06%, respectively. For all six producers, the computed number of turbine units required for setting up the GTW process are 8, 5, 25, 38, 1 and 25, respectively. Further, Nigeria and Venezuela are currently experiencing an energy supply crisis, and, as evident in our results, both these oil producing nations can generate power using a maximum of 38 and 25 turbine units, respectively. We recommend both producers should invest in the GTW process and in a more highly skilled labor force, on par with those of the benchmarks identified by our proposed model.