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GE Report Finds Gas Flaring Wastes 5 Percent of World's Supply

General Electric, the largest US industrial group, is launching a campaign to cut gas flaring, the wasteful and polluting practice of burning off gas released during oil production.

A new report just released by GE estimates that 5 percent of the world's natural gas production is wasted by burning or "flaring" unused gas each year -- an amount equivalent to 30 percent of consumption in the European Union and 23 percent in the U.S.

Gas flaring emits 400 million metric tons of CO2 annually -- the same as 77 million cars. Worldwide, billions of cubic meters of natural gas are wasted annually, typically as a by-product of oil extraction.

Despite the gigantic numbers, there's good news, as eliminating wasteful gas flaring could be the next big energy and environmental success story based on technologies that exist today. For example, among the tech solutions is capturing the gas and using it for power generation or re-injecting it into the ground to help with oil recovery efforts.

GE's study finds that nearly $20 billion in wasted natural gas could be used to generate reliable, affordable electricity and yield billions of dollars per year in increased global economic output.

In action: In the first large-scale application of its type, advanced compressor technology from GE Oil & Gas will be minimizing liquefied natural gas (LNG) flaring in Qatar.

The gas that usually boils off during the loading of LNG carriers at port will now be collected and transferred to a central compression area via pipelines and then used to fuel the refrigeration plants that liquefy the gas for export.

As gas is often present when drilling for oil, gas flaring has been part of the oil industry since its inception. With much work having been done over the last decade, large scale flaring is rare at new drilling projects.

However, some of the largest waste gas streams occur in remote areas where lack of a market, lack of pipeline access, and/or small volumes do not justify the expense of gas gathering.

"With greater global attention and concerted effort- including partnerships, sound policy and innovative technologies -- large-scale gas flaring could be largely eliminated in as little as five years. It's a win-win outcome," said Michael Farina, program manager at GE Energy and author of the white paper.

For example, as The Financial Times noted in its story, "if Russia could capture half its flared gas and sell it at domestic market prices, it would be worth an extra $2bn a year." Farina told the paper that "there were many countries, such as Norway, Indonesia and Angola, that provided good examples of how to cut flaring."

The next step involves a coordinated effort from central and regional governments, oil and gas producers, technology providers and the international community.

The goal is to highlight the financial benefits associated with reducing gas flaring; secure local government support for monitoring and enforcing flaring regulations; and build capacity that helps local investors and contractors develop, operate and service distributed power generation.

The report provides a region-by-region analysis of gas flaring trends. In the case of Nigeria, it has reduced flare gas emissions by 28 percent from 2000 levels. Even so, the country's oil industry still wastes 15 billion cubic meters of natural gas every year. While nearly half of the population has no access to electricity, the country spends nearly $13 billion per year on diesel-powered generation and perhaps 10GW of potential electricity is flared away.

A PDF copy of the report, Flare Gas Reduction: Recent Global Trends and Policy Considerations, is available by clicking here

Photo CC-licensed by Adam Cohn.

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