Latest update May 13th, 2024 12:59 AM
May 24, 2022 News
…as Guyana currently produces 340,000 barrels daily without full coverage insurance
Kaieteur News – More than four months after the disastrous oil spill in Peru – the Peruvian authorities have sued Spanish oil giant, Repsol, for a total of US$4.5B for the environmental disaster.
On January 15, approximately 12,000 barrels of crude was spilled from one of the La Pampilla refineries, which is owned by Repsol, off the coast of Ventanilla in the region of Lima, Peru.
The spill was reportedly caused by shock waves from an undersea volcanic eruption near Tonga in the South Pacific Ocean. At the time of the undersea eruption, Suezmax tanker, Mare Doricum, was offloading a shipment of Brazilian crude oil at a La Pampilla refinery offshore mooring buoys when a quantity of the cargo was released.
According to a statement by Peru’s National Institute for the Defense of Competition and Protection of Intellectual Property (INDECOPI), a lawsuit was filed before the 27th Civil Court of the Superior Court of Justice of Lima, on behalf of more than 700,000 affected citizens.
INDECOPI has since filed the first civil claim for liability for diffuse interests in Peru against Repsol, due to the oil spill in Ventanilla that affected consumers, users and third parties.
The civil claim for compensation for damages was filed for a total of US$4.5B against several defendants: Repsol SA (Spain), Mapfre Global Risks (Spain), Mapfre Peru Insurance and Reinsurance Companies (Peru), La Pampilla Refinery (Peru), Transtotal Maritime Agency (Peru) and Fratelli d’amico Armatori (Italy).
Repsol’s Chief Executive Officer (CEO), Josu Jon Imaz had announced that the clean-up and remediation of the spilled crude is expected to cost some US$65 million.
However, Kaieteur News understands that the process in the lawsuit that was filed against the oil giant, allows an abstract valuation of US$3B for the damages caused by the spill and US$1.5B for the non-material damage to consumers, users and third parties.
Speaking on the lawsuit, executive president of INDECOPI, Julián Fernando Palacín Gutiérrez, stated that “these actions could generate jurisprudence on issues of oil spills that cause damage and collective moral damage due to pollution of the environment in coastal areas, beaches, artisanal fishing activities, tourism and commercial activities of the more than 20 affected spas.”
Following, the devastating oil spill, several Peruvian officials had called for the oil company to offer compensation for the disaster.
The first action taken against the company was by Peruvian judge, Romualdo Aguedo, on Friday, January 28, 2022, who granted an order to prevent four Repsol’s executives from leaving the country. Peruvian media reported that Judge Aguedo imposed an 18-month ban on the grounds of the potential risk that the officials might leave Peru.
Among them were: refinery manager, Jaime Fernández-Cuesta Luca de Tena; terminal manager, Renzo Alejandro Tejada Mackenzie; environmental manager, Gisela Cecilia Posadas Jhong and production manager, José Gregorio Reyes Ruiz.
In taking additional steps, Peru’s former Minister of the Environment, Rubén Ramirez in January had revealed that the government had taken the decision to suspend the company’s hydrocarbon loading and unloading activities. In other words, Repsol’s operation in the country was halted until it can substantially prove that another oil spill will not occur again in its waters.
Subsequently, a fuel shortage in Peru forced the country’s OEFA to lift the suspension on Repsol’s operation temporarily. However, the company was only allowed to continue its operations for 10 days and under supervision from the OEFA – that operation has come to an end.
To date, Repsol has failed to comply with several administrative measures that were issued and as such the OEFA has so far imposed five coercive fines for a total sum of 2,300,000 soles (US$616, 043).
This publication had reported that three months after the crude was spilled into Peruvian waters – the affected people, mainly fishermen, were able to access the emergency fund the government organised for them to receive as advance compensation from the culpable oil company.
The advance compensation to the fishermen and others affected by the spill came about as a result of negotiations done by the Government of Peru which was working to get the Spanish oil giant, to assume the economic impact of the spill.
It was reported that since a legal process for compensation to the affected families would take a long time, the Government of Peru had gotten the oil giant to sign an advance compensation agreement.
In order to provide adequate aid for the citizens, the Peruvian government had ordered the oil giant, to pay an additional sum of US$700 compensation to each citizen affected by the spill.
While the Government of Peru continues to take action to protect its people and its environment, Guyana in contrast, continues to give American oil giant, ExxonMobil, permission to operate without a guarantee that it would cover the cost for any oil spill that surpasses the capacity of its subsidiaries to pay.
In February, last, ExxonMobil announced that it has commenced oil production at Guyana’s second offshore development area called Liza Phase Two in the Stabroek Block.
It would be poignant to note that with the coming onstream of the Liza Phase Two operations, the country now has an installed production capacity of some 340,000 barrels of oil daily.
This is from the two Floating Production Storage and Offloading Vessels—Liza Destiny and Liza Unity—currently operating in the Stabroek Block.
Additionally, the operations are being undertaken (producing 340,000 barrels of oil daily) in Guyana without full coverage insurance in case of a spill domestically.
The current administration, despite promising to press ExxonMobil Guyana (Esso Exploration and Production Guyana Limited) on the issue to have the parent company (ExxonMobil) for the Guyana Operations sign on to binding full coverage insurance, has since shifted that responsibility to the Environmental Protection Agency.
Notably, among the oil companies working in Guyana’s backyard is the very oil company –Repsol – that caused the oil spill in Peru.
Listen how to run an oil country
May 13, 2024
GCB T10 Blast Semi-finals… Kaieteur Sports – The semi-finals of the GCB T10 Blast will get underway today, barring inclement weather as the final four teams look to book spots in the...Kaieteur News – The PPP is engaging in myth-making in seeking to perpetuate the narrative that it is now an ideologically... more
By Sir Ronald Sanders Is it ever justifiable for journalism to fan the flames of geopolitical tension? This question arises... more
Freedom of speech is our core value at Kaieteur News. If the letter/e-mail you sent was not published, and you believe that its contents were not libellous, let us know, please contact us by phone or email.
Feel free to send us your comments and/or criticisms.
Contact: 624-6456; 225-8452; 225-8458; 225-8463; 225-8465; 225-8473 or 225-8491.
Or by Email: [email protected] / [email protected]