May 01, 2023 News
Kaieteur News – The unprecedented production statistics recorded in recent days by oil and gas giant, ExxonMobil has not slipped the attention of the Oil and Gas Governance Network (OGGN), an advocacy arm dedicated to better management of Guyana’s petroleum sector.
In a recent missive, members of the group, including Alfred Bhulai, Dr. Vincent Adams, Andre Brandli, Janette Bulkan and Darshanand Khusial, reasoned that citizens have been assured on multiple occasions by the petroleum companies that their operations are in keeping with international standards. These standards however require inspectors to certify compliance, the OGGN members pointed out.
In laying the foundation for their argument, the OGGN representatives highlighted that the two Floating Production Storage and Offloading (FPSO) vessels- Liza Destiny and Liza Unity- have been both operating above the prescribed safe operating limits outlined in the Environmental Impact Assessments (EIAs) submitted by the operator. This document formed the basis for each Permit to be granted and is often times referred to as the ‘Bible’ of a project, simply meaning that the established protocols must guide the project activities.
Be that as it may, the said EIAs for the Liza One and Liza Two projects each specifically outline 120,000 and 220,000 barrels of oil per day (bpd), respectively, as the safe operating limit. In the meantime, Esso Exploration and Production Guyana Limited (EEPGL), the operator of the Stabroek Block has pushed production to as much as 156,000 and 246,000 bpd at the Liza One and Liza Two projects respectively on February 24, 2023. This “brazen disregard of safety” the OGGN said has been welcomed by the Government as an achievement of reaching 400,000 bpd.
To this end, the Network said, “Many knowledgeable people in Guyana and those in Caribbean are concerned that such blind faith in the adherence of these companies to safety procedures may lead to an oil spill ― especially as the Guyana Government is afraid of requiring these petroleum companies, of limited liability, to sign a parent company guarantee that any damage over and above the insured figure will be paid.”
Presently, Guyana has been assured of a US$600 million insurance policy per oil spill event in the Stabroek Block, where over 11 billion barrels of resources have already been discovered.
The citizens inquired, “Isn’t this continuous exceeding of the design safety limit a much greater risk? Or does our government not understand this? A competent Petroleum Commission should have been in place to insist on adherence to standards.”
The representatives argued that the government is elected to represent the people; as such it must insist the oil companies back up their claim of safety by taking one obvious step in good governance and show the international certificates that permit production above the prescribed safety limits at the FPSOs.
“Publish the international certifications that allow the oil companies to operate over the safety limits! It is no secret that the oil companies award themselves and their executives big bonuses and salary increases based upon production numbers which naturally incentivize this type of irresponsible behaviour. Good governments, who care for their country, should therefore ensure no expense is spared in being transparent towards the people in these grave matters and in implementing competent oversight, to ensure the health, safety and environment of the nation are not superseded by greed,” they reasoned.
In February, Kaieteur News reported that Guyana’s two oil ships—the Liza Destiny and Liza Unity—reached their highest production mark in January at 400,160 barrels, according to data from the Ministry of Natural Resources. This was attained on January 12, 2023. A breakdown of the data indicated that the Liza Destiny produced 153, 890 barrels on that day while Unity was 246,270 barrels.
This “achievement” was later mirrored on February 24, 2023. According to statistics produced by the Ministry of Natural Resources, the Liza Destiny produced 156,080 barrels while Liza Unity produced 246,000 barrels, bringing the total production level to 402, 080.
Regulator for the oil and gas sector, the Environmental Protection Agency (EPA) assured in the past that any changes to activities must be vetted by the body.
Executive Director of the EPA, Kemraj Parsram had said in a previous interview, “In all of the environmental permits, one of the key requirements is that if there is any change to what was approved, they (Exxon and partners) must seek approval from the EPA and in so doing, we will require information that will help assess if it will cause significant impacts before approving same.”
Head of the Oil and Gas Department, Joel Gravesande also confirmed this, noting that ExxonMobil’s subsidiary; EEPGL did seek permission before pumping more oil at its Stabroek Block operations.
Gravesande said the consideration of impacts from a worst-case scenario of an unmitigated oil spill is also considered in the EIA for the Liza Destiny at 200,000 to 300,000 barrels of oil per day.
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