Gas flaring is the burning of so-called ‘associated gas’ – the gas that is produced as a byproduct of oil production. It is a large issue, about 150bn m³/y. That’s about 4% of global production, and about a $30bn revenue opportunity, or represents emissions totalling 1bn tCO₂e or more. If we can fix flaring, we can not only reduce emissions, but also improve energy security, generate revenue and accelerate the transition.

Flaring is part of a broader family of sources of methane within the oil and gas industry, which includes venting and leaking. Methane emissions are rightly getting a lot of focus in the news and media, and in scientific study. That’s because methane is a highly potent greenhouse gas (GHG), 30 to 80 times more than CO₂. But the link to flaring is important because flaring, which is mostly burning natural gas, also has incomplete combustion, so it releases significant sources of methane. By fixing flaring, we can also address this very important methane challenge.

Barriers that are cited as hindering progress against flaring today include things like a lack of infrastructure needed to send the gas to market, a lack of a buyer, a lack of an attractive market, project complexity, data gaps and lack of awareness. Lack of penalties or their enforcement, non-conducive fiscal regimes, regulatory obstacles, and lack of capital or financing are also noted. We believe that most of these barriers can be overcome. In fact, those countries and companies that have made progress have already done so.

Case studies
A series of large deepwater oil discoveries were made offshore Angola, southern Africa, in the early 2000s. Sonangol (Sociedade Nacional de Combustíveis de Angola), the national oil company and also partly the regulator, set as a condition of their development that there must be a plan to commericialise the associated gas. The solution arrived at was an LNG plant – the first of its kind in the country.

Several operators of the fields came together to develop this LNG project. They overcame significant physical and technical barriers, such as having to cross the Congo River, to put a pipeline underneath the Congo Canyon, and even clearing land mines. These requirements impaired the economic costs on startup, but were not related to utilising associated gas.

The overall result was reduction in flaring – capturing up to 6bn m³/y and reducing emissions by up to 39mn tCO₂e/y. Key to the project’s success was the leadership and involvement of Sonangol, with the cooperation of international oil companies (IOCs), and the government of Angola, which demonstrated flexibility in setting fiscal terms.

Far to the north, the Sarqala field is in the Kurdistan region of Iraq, which was flaring up to 40mn cf/d, which is something like $70mn of gas being wasted annually. The government realised it really needed reliable power. The local grid relied extensively on diesel and heavy fuel oil, which was unreliable. That was driving civil unrest. By capturing the gas, the provincial government could generate power and solve a problem. To encourage the upstream partner, it tied increases in oil production to solving the flaring problem. To that end, UK contractor Aggreko installed 200 portable gas generators within seven months. With a combined capacity of 165 MW, the power generated was bought by the regional government and since 17 May 2021 there has been a significant reduction in flaring. This is despite the location remaining challenging to work in, and there are frequent payment delays that can make it difficult to operate.

On the other side of the world, in South America, Argentina’s Vaca Muerta Basin is seeing huge growth in interest in the extraction of shale gas. The operator of the Los Toldos Este II field wanted a solution for flaring from the start of operation, but the project was far from market and a pipeline. It decided to capture the gas, generate power and use the power to mine cryptocurrency. The project was developed by specialist contractor Unblock. Eight generators have an installed capacity of 12 MW, powering 12 containerised high-performance computing units, with enough power to mine 82 Bitcoin per year. From early December 2024, there has been very little flaring and significant decarbonisation.

Solving flaring is not really a technology issue. It is more an issue that’s about commercial agility, organisational change and putting in the right kind of policy instruments.

Countries
Iraq as a whole flares a lot of gas, 16.3bn m³ in 2023, even though it has a huge need for power. This is because power plants there run on liquid fuel. The country has experienced blackouts, which have caused civil unrest. It has had to import gas from Iran, and from this summer will even start importing LNG.

The country has had two major flare reduction projects. First was a project carried out by Basrah Gas Company, a joint venture between state-owned South Gas Company (51%), Shell (44%) and Mitsubishi (3%). The project is currently processing 10bn m³/y, which is substantial. It wasn’t always so successful; in the early years, flaring increased despite the efforts of this project, because oil production was expanding, and the additional associated gas production exceeded its ability to capture and process it. Even now, it is only processing half of the original goal. The project developers never constructed the LNG facility that was called for in the initial designs.

The second flare reduction programme is the Gas Growth Integrated Project (GGIP), which involves TotalEnergies (45%), Qatar Energy (25%) and Basra Oil Company (35%). It is scheduled to start this year and ramp up to 3bn m³/y, rising to 6bn m³ if there is a second phase of development.

In between the two projects, a decade has been lost. Initially the problem was the fall in oil prices in 2014, upon which the country relies, and then it had to pay the costs of fighting Islamic State. From 2017–2021, government indecision meant that flare reduction proposals weren’t taken forward until GGIP. Iraq has set a goal to cease routine flaring in 2028. Even if it is an ambitious target that might not be met, it sets the country on a positive trajectory.

To the west, Algeria in north Africa has modestly high levels of flaring – 8.2bn m³/y in 2023. It has significant export infrastructure, including three pipelines to Europe and two LNG facilities, which appear to be underutilised according to public information. But the country also has growing gas demand. So, oil and gas operators are flaring gas despite having opportunities to use it. Algeria has had significant flaring penalties written into law for years, but they don’t seem to be being collected. If they are not collected, the rule doesn’t provide an incentive to capture flared gas. In addition, gas is sold in the domestic market for very low regulated prices, although it is currently in the process of being liberalised. Until market reform work is completed, capturing gas for internal sale will remain largely uneconomic.

To the east, Egypt’s flaring numbers are modest – at1.9bn m³/y – but at a high intensity: 9.1 m³/barrel, which is double the global average. Like northern African neighbour Algeria, it has growing gas demand, and like some Middle Eastern nations, has experienced blackouts. To prevent them, the country is importing LNG at great expense.

In order to avoid paying high prices for imports, and taking best advantage of its own natural resources, two things need to happen. First, Egyptian Natural Gas Holding Company (EGAS) has an effective monopoly on gas purchases, and also sells gas for low regulated prices that block any incentive to capture flare gas. Probably, the subsidy required to purchase captured flare gas is lower than what is needed to buy expensive LNG imports. Second, Egyptian flaring is characterised by being small and scattered, mostly across the Western Desert region. It appears that some 70% is located within 20 km of a main pipeline. But to capture that gas Egypt is going to have to organise cluster infrastructure to capture gas from many flares in many fields, which will require effective planning, and some determination.

Insights and recommendations
The fact that these cases have made progress is a clue that actually solving flaring is not really a technology issue. It is more an issue that’s about commercial agility, organisational change and putting in the right kind of policy instruments.

There are two actionable recommendations. The first, as we’ve alluded to, is the need for a holistic approach on GHG accounting. We can reduce the volume of gas that goes to the flare, and by capturing the gas at the flare we reduce the amount of methane that goes out. Reducing methane through solving the flare is a major reduction initiative. The second is that that gas, when captured, can be put to good use – for example, to generate power that would then displace another form of more carbon intensive generation. 

If you add those two effects, you can deliver a dramatic reduction in emissions, by up to 80%. But that, unfortunately, is not the whole story. Also, as we’ve hinted at, sometimes the justification for doing a flare capture project is to produce more oil. And if the oil production is increased as a result of the commitment to reduce the gas flaring, it then puts the emissions reduction we saw from the flare in that project in a broader context. What this means is that we really need to deploy our limited funds of capital that we have to solving gas flaring on the most impactful projects.

Projects where the oil production project will go ahead regardless of whether there is a solution or not, have to be the top priority. Iraq is a case in point. Secondly, there are plenty of projects around the world where actually just running the project better, having better performance, better equipment reliability and better maintenance, backed up by data used as a performance tool, really drives reduction of emissions, particularly around upset flare emissions (release of flare gases into the atmosphere during unplanned or abnormal operating conditions, such as equipment malfunctions or maintenance activities). And thirdly, there are those projects where we can capture gas that does not require any new major infrastructure – Algeria was a great example of that.

This article is based on a 5 June webinar discussing the new CCSI/Capterio report, Igniting action to reduce gas flaring: Real opportunities. Real projects. Real results.

• Further reading: ‘Methane: Time for our industry to accelerate action’. Bjørn Otto Sverdrup, a former Equinor Senior Vice President, now Chair of oil and gas decarbonisation body OGCI’s Executive Committee, explains why methane is one area of emissions that the oil and gas industry urgently needs to tackle.
• Although reducing upstream emissions of methane has been a hot topic over the past 12 months, and industry bodies are following with the publication of significant technical guidance, methane measurement standards are lagging behind. Find out why.