The Bank keeps looking for ways to turn major environmental problem into business opportunity for its clients.

As the EBRD has proved time and time again, “environmentally friendly” can and should mean “business-friendly”. Two EBRD projects were honoured for their strong impact on gas flaring reduction at the 10-year anniversary event of the World Bank’s Global Gas-Flaring Reduction (GGFR) partnership’s Forum in London.

At a reception ceremony, the GGFR handed an award to the Bank’s Monolit and Irkutsk Oil Company projects, both located in Russia. In 2010 the EBRD provided a US$ 87 million long-term financing package to Monolit, whereas Irkutsk Oil Company received a US $55 million loan in 2008.

The event stressed that the waste of associated petroleum gas (APG) can be turned into profits. Global APG flaring has a significant environmental impact and is equivalent to 30 per cent of the European Union’s gas consumption.

“It was a challenge for us to reduce gas flaring, especially in our remote areas. But with the help from the EBRD which supported our gas flaring reduction programme it was possible to reduce gas flaring by re-injecting it into the reservoir instead of flaring”, said Anastasia Pavlenko, Oil lead manager from Irkutsk Oil Company. By the end of next year, she added, the company plans to almost completely eliminate gas flaring.

The EBRD Director for Energy Efficiency Terry McCallion looks at the problem with a banker’s eye: “Clearly there are huge carbon emissions reductions impact that contributes to the environmental benefits, but I think what’s more compelling for business people is financial benefits. If you turn all the gas that’s being flared into a commodity that can be sold at world market prices we are talking about something in the order of US$ 50 billion. And that really puts the financial bottom line into the environmental challenge of reducing gas flaring”.

The EBRD continues the regional strategic market study in Russia, Kazakhstan, Azerbaijan and Turkmenistan, launched last year. The study aims to identify new bankable projects in gas flaring reduction that can be financed by the EBRD.