Former EPA Head Vincent Adams is insisting that ExxonMobil’s flaring of gas amid a compressor problem on its oil platform is in breach of its production permit and he said that the government has to be better informed so that it could enforce the law.
In an interview with Stabroek News, Adams also called for an independent check to be done of the compressor problem aboard the Liza-1 Floating Production, Storage and Offloading (FPSO) platform and called for national unity on environmental and safety matters in the oil and gas industry as in the case of border matters.
Using the Liza 1 Permit and the Environmental Impact Assessment (EIA) that helped to guide in the forming of that document, Adams said the current high offshore flaring by ExxonMobil should be looked into by both the government and opposition with the aim of pressuring the company to swiftly remedy the issue as there are no experts here to advise and gas flaring here is being exploited by the company.
The independent assessment should be conducted to ascertain the cause of the compressor seal problem as it “also begs the question, did this production exceedance above the safety limit have anything to do with the seal failure?”
In a terse statement on January 29th, Exxon Mobil said “There was a technical issue regarding a seal on the gas compressor on Liza Destiny. This unfortunate incident resulted in us having to temporarily increase our flare above pilot levels in order to maintain safe operations”.
It quoted Alistair Routledge, President of ExxonMobil Guyana as saying “We are disappointed that this unexpected issue has occurred and we’re working diligently with the vessel’s owner and the equipment vendor to understand and fix the issue as quickly as possible”.
On December 20 last year, Exxon said that flaring of gas was now down to “pilot levels”. Problems just a month later will raise questions about whether Exxon and its offshore partners have settled the issue.
Underscoring that when he speaks on matters of oil and gas he does so from an apolitical position as a Guyanese who wants best for his country, Adams said he does not want to be sucked into political rhetoric while oil companies “ride this country”.
“Exxon’s recent untruthful public utterings are nothing more than a PR campaign to cause confusion and distraction so that the people won’t notice their illegal flaring which allows them to stay at their maximum oil production rate of 120,000 bpd to make maximum money for the corporation, never minding the damage to Guyana’s environment and its people’s health,” he told Stabroek News in an interview.
“According to the EIA, the production rate would be 100,000 bpd but the Float-ing Production, Storage and Offloading platform was `designed to safely operate at sustained peaks of 120,000 bpd’. If Exxon honestly believes that they must comply with the EIA, why were they producing at 130,000 bpd when the seals failed, which is 10,000 bpd above the safety envelope defined by the very EIA they refer to? These are questions that need to be asked by policymakers. Politicians have to stop looking for political mileage and get into the mature realm where they can say to the other side, this issue is ours”, he added.
With flaring offshore estimated to reach 14 billion cubic feet (cu ft.) of gas by the time ExxonMobil expects the problem with its compressor to be resolved – hopefully in April of this year – government last Tuesday said that it is “hamstrung” in instituting penalties since the company has argued that it is within the limit allowed by the Environmental Protection Agency (EPA).
However, a review of the Permit by this newspaper reveals that there is no such provision in the permit.
Cherry pick
Adams, the holder of PhDs in environmental engineering, two MS degrees in petroleum and geological engineering, plus 40+ years of international experience in energy, said that both the company and government should be fully aware of the basic tenet that “the environmental Permit issued by EPA, is the legal document that sets all operating parameters and limiting conditions, and not the EIA which is deve-loped by the operator. The EIA by definition, he reminded, “serves as the assessment document which evaluates the ranges of alternatives, scenarios, risks and mitigative actions associated with the project. The EPA then uses these EIA evaluations, conclusions and preferred options to establish the limiting conditions that are codified in the Permit.”
He said that ExxonMobil wants to cherry pick excerpts of the EIA to suit its own agenda since when the EPA had asked them to use a similar estimate for an oil spill scenario, they bluntly rejected it and reminded the agency that the EIA was not a permit.
In relation to this specific issue of flaring, the EIA evaluated three options for the disposition of produced gas and determined that re-injection of the gas, along with flaring only in non-routine production, was the preferred option. The EPA, he said, adopted this option and incorporated it into the Permit as the legally binding limit for flaring.
“There was no conclusion or recommendation in the EIA for consideration in the Permit based upon a cumulative quantity of gas emitted over a period of time such as this so-called 14 bcf. Hence, any flaring under routine production regardless of the production rate is a violation of the permit and is illegal. Therefore, if Exxon honestly believes that the EIA is the document to follow, why then aren’t they complying with the only conclusion in the EIA related to the flaring limit that flaring should not occur during routine operation?” he questioned.
“Similarly, if Exxon so believes that the EIA is the governing legal document, why did they so steadfastly object to applying the maximum 50,000 bpd oil spill scenario evaluated in the EIA as representing the maximum risk to guide their operating plans; but instead, insisted on the much less risk scenario of 20,000 bpd? This fake 14 bcf argument appears to be all a trickery to distract from their violation of the law invoked by the Permit, requiring that no flaring is allowed under normal production,” he added.
Adams declared that it is “sheer barefacedness for Exxon to continue to repeat that it remains in compliance with all our environmental permits and regulatory requirements when it is indisputable that it is violating the flaring limits in the EPA Permit”. He reasoned that “Exxon had already acknowledged this fact by their acquiescence to the EPA demand in 2020, to reduce production to the minimum of 25,000 – 30,000 bpd oil for safe operation when they experienced the same compressor malfunction. It is puzzling why the (PPP/C) Government is not demanding the same action this time around.”
“We no doubt should welcome Exxon here to make money for their corporation, but they will be gone in the next 30 years or so, while we will be here forever to deal with whatever is left, so our country’s politicians must do whatever necessary to control what would be left for our future generations. Now is the time to ensure this protection of the environment for, as many parts of the world have experienced, large scale pollution of air and water becomes almost impossible to clean up. It would be a grave mistake to wait until there are 10 FPSOs running and this unresolved flaring problem is multiplied 10 times”, he said.
Adams asserted that current high offshore flaring by ExxonMobil should be looked into by both government and opposition with the aim of pressuring the company to swiftly remedy the issue as there seems to be no end to what appears to be the capitalizing on our limited oversight capacity by the company.
Consequence
Vice President Bharrat Jagdeo was asked by this newspaper for an update on the issue of the EPA’s review of the permit. He holds firm that the EIA’s provision for the 14 billion cubic feet of flaring is there but said that the EPA’s legal team was reviewing this.
“I have seen some comments about the EIA, the approved EIA is not the permit. I think the Former Head [of the EPA] said the approved EIA doesn’t matter. It is such a callous position to take. When he was there, he knew all along that the EIA went to the agency and was approved by the agency with that huge allowance. It is all very political but that is the reality that they allow the equivalent of 14 bcf of gas to be flared. There is no hiding and as a consequence we have this issue here,” Jagdeo said.
Adams was not the Head of the EPA at the time that the Liza-1 EIA was swiftly approved.
Adams says that he will wait to hear the report of the EPA team to government as he does not believe that Jagdeo was given all the details. “It should be of some concern when seeing and hearing high Government officials such as the Honourable VP and Honourable Minister (of Natural Resources) repeating the misinformation being peddled by ExxonMobil. They should be getting advice from their trusted government technical officials and not ExxonMobil,” he said.
He said that indeed, the EPA and entire public was made fully aware of an EIA for this project, since by law, it was made available for public review. However, he emphasized that “there is no such an allowance in the EIA to flare 14 bcf of gas; so Exxon’s `argument’ to this effect, is false”. He reminded the company that it had last year tried to use the same argument when the compressor failed but was rebuked.
“As a matter of fact, Exxon brought this so-called allowance to the attention of EPA during last year’s flaring problem and we immediately dismissed it as nonsense,” the former EPA Director stressed.
Using the EIA as a reference, he said, “So here is what the EIA says: (1) based upon the EIA evaluation of the three alternatives for disposition of the produced gas, the EIA incontestably concluded that the preferred selected alternative is re-injection of the gas with no flaring during routine/normal operations. This conclusion was adopted from the EIA and put into the Permit. It is illegal not to comply with the conditions of the Permit and must be penalized and stopped from doing so. Further, if Exxon claim to be righteously following the EIA, why are they not following this condition so explicit in the EIA?”
“As for the so-called 14 bcf gas flaring allowance supposedly in the EIA, let me say that there is no such number in the EIA, but if Exxon knows otherwise, they must show where it exists in the document. But for argument sake, let’s take a closer look at that 14 bcf number. Exxon claims it to be a cumulative allowance for the period 2020 – 2021. Their plan in this same EIA scheduled six months of operation in 2020 and 12 months in 2021 for a total of 18 months over the 2020-2021, the period for which they claim this allowance exists. This calculates to be a minimum of about 26 Million cu feet per day (mcfd) of flaring, which is 13 times what is required for pilot flaring required during all production conditions. It’s also in total conflict with the EIA which pellucidly stated zero flaring (except for pilot flaring of 2 2 mcfd) during normal operation which Exxon promised to be starting from day one. Pilot flaring would have only consumed about 1 bcf over that 2020-2021 period. This leaves 13 bcf to be accounted for by Exxon in their so-called allowance built into their plan. This high volume of 13 bcf could only have been realized by flaring during normal operations which is what Exxon has been doing since startup”, Adams told Stabroek News.
Carbon sink
Adams said that with the 14 bcf argument being ExxonMobil’s focal point when asked about flaring, “it also begs the question: Did Exxon put this so-called 14 bcf in their planning and hence in the EIA because they knew all along that they would have been flaring during normal operations, even if it meant violating the Permit?”
And when ExxonMobil promised that it would do a root cause analysis of the situation, Adams said that one year after startup was not acceptable and the company must be held accountable.
“Exxon’s promise to “take this (flaring) incredibly seriously” and to do a root cause analysis, is in itself incredulous. Apparently, they must be reminded that they had been making the same promises since start of production in December of 2019. In fact, they first promised to have no flaring from day one, then day one became a promise of day 60 which became a promise of day 90, and now the same promise ongoing for over one year without resolution. Besides, they must have forgotten that they had also promised to do a root cause analysis from the inception of the compressor malfunctioning since soon after production started over one year ago. Did they keep their word to do such a root cause analysis? And if so, where is the report? What are the findings? And why is another root cause necessary?” he questioned.
‘Mind you now, this is the same Exxon that according to recent news reports, finds itself in an untenable position with their shareholders, because of what they see as less than adequate performance in stewardship of the environment. Accord-ing to their corporate annual report, they are working diligently to cut their air pollutants by 20-30%; but at the same time, during the Payara review, as a justification for flaring, they posited that Guyana is a net carbon sink so it has the capacity for taking in more air pollutants. If this is not the most uncaring and heartless behaviour towards the people of Guyana, I don’t what is!” he exclaimed.
It is why Adams said that the nation has to put pressure on its policyholders.
“With all of the mixed messages, confusion, violation of the EPA’s Permit – all as discussed above, plus the many questions of environmental performances coming from their own shareholders, is this the company we want to trust without our proper oversight, with protecting our health, safety and the environment of the people of Guyana? There is also enough reason as discussed above to warrant an immediate investigation of ExxonMobil’s operation by the Government of Guyana. The Government must also ensure that Exxon is held accountable for its fault, by making sure that they stand the costs incurred for all of the disruptions and repairs,” he said.
