US$45 tax on Exxon’s flaring an improvement - VP Jagdeo boasts

US$45 tax on Exxon’s flaring an improvement – VP Jagdeo boasts

Sep 27, 2021 News

Kaieteur News – Vice President, Bharrat Jagdeo, recently downplayed Guyana’s management of the hazardous practice of flaring being done by ExxonMobil aboard the Liza Destiny vessel in the Stabroek Block. The high ranking official said, “We are dealing with the question of flaring” and pointed to, among other measures, a US$45 tax that was imposed for same being done above one million standard cubic feet of gas per day.

Vice President, Bharrat Jagdeo, during the press engagement on Friday

Vice President Jagdeo was at the time addressing a press engagement at Hilton New York, where he was joined by Head of State, President, Irfaan Ali, to provide an update on their participation at the 76th United Nations General Assembly (UNGA). During that meeting, he was asked if the matter of flaring was raised with ExxonMobil during discussions on Climate Change.
To this end, the former Executive President, now Vice President, told media operatives that Guyana has a policy of no flaring and has in fact, instituted a US$45 dollar tax for every metric ton of natural gas flared.
He in fact used the occasion to laud the accomplishments of the Ali administration, in issuing the Licence and Environmental Permits for ExxonMobil’s third proposed oil field in the Stabroek Block—Payara.
Expanding on his position, the Vice President was adamant “we have demonstrated how we are going to approach flaring in Guyana, we believe in a no flaring policy.”
According to Jagdeo, when his administration got into office in August last year, it was met with a situation where two permits had already been issued for the Liza I & II developments, and that the Payara approval was pending.
To this end, he explained that upon examination of the first two permits, the government found they were very deficient. Jagdeo explained that within six weeks, the administration managed to fundamentally change the environmental issues surrounding the development of the gas field “so in the new environmental permit that was issued, that was substantially different.”
He also drew reference to the introduction of a US$45 tax on the company for every metric tonne of gas flared—up from the US$35 the Environmental Protection Agency had initially imposed.
Additionally, the Vice President said the tax is applied to any flaring that is done beyond the commissioning.
Very few countries have such a tax based on carbon emission, Jagdeo argued and also pointed to compensatory payments “for our share of the gas flared.”
He said too, among some of the critical changes in the issuance of the third environmental permit to ExxonMobil, is the securing of a commitment to obligate the oil block operator to “manage waste from cradle to grave.”
He argued again, that in many countries, waste is left behind by oil companies, but in the Payara permit, ExxonMobil will be responsible for handling the management of waste such as, chemicals and produced water, among other detrimental apparatus used in the oil operation, throughout the life of the oil field.

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