Former Director of Guyana’s Environmental Protection Agency (EPA), Dr. Vincent Adams yesterday waded into both government and ExxonMobil for the recent announcement that excessive gas flaring from offshore oil operations will attract a fine of US$30 per Co2 equivalent, calling it a window for pollution.
“It’s a shameful capitulation to ExxonMobil’s original justification for flaring that because Guyana is a carbon sink, we have the capacity to take in more pollutants from flaring,” Adams told Stabroek News.
“The modified (EPA) permit incredulously allows flaring for 60 days for start-up and 14 days for special circumstances, compared to internationally accepted standards such as the United States standard for example, which only allows 2 days of flaring for start-up. That notwithstanding, ExxonMobil would pay the fine only for the C02eq emitted in excess of these periods of flaring. This means that ExxonMobil would now have a free pass to flare for an additional 60 days – a condition that was not evaluated in the EIA (Environmental Impact Assessment),” he said. The former EPA Head who was abruptly dismissed when the PPP/C took office last year August, said that the permit has also egregiously increased permitted flaring by EPA and comes also at a time when the oil major has made a commitment to curb flaring by almost 50% across the rest of the globe.
“This begs the question: Are Guyanese lives of lesser value than those in the rest of the world? It is unbelievable how our Government would choose to so embolden ExxonMobil to do as they please, as they laugh at our laws, while there is no representation afforded our people,” he posited.
‘Methodology’
But most concerning to Adams was the non-disclosure on which method would be used to calculate the CO2eq since the gas is totally different to the reported amount of gas flared and its calculation could become very complicated given that the application of any of several methods and inclusion of key parameters, such as Global Warming Potential (GWP).
He explained that those parameters vary with time periods such as 20, 100, 500 years, or a life-time and would each yield vastly different results. “The Permit must stipulate which reference method must be adopted for the CO2eq calculations, and not left to EEPGL (ExxonMobil’s subsidiary) to determine to their obvious advantage,” he stressed.
Also of high concern is that the EPA here would be setting a CO2eq permit requirement, but the agency “does not have a working knowledge of its implementation including determination, methodology and its management.”
“The EPA with this lack of expertise, would therefore have to leave it all to ExxonMobil’s self-imposed CO2eq permit requirement and management to calculate its own fines – an obvious conflict of interest,” he stated.
Through a statement, the EPA on Thursday announced that the Environmental Permit for the Liza Phase 1 Development Project offshore Guyana had been modified and ExxonMobil’s subsidiary, EEPGL will now be required to pay a fine for gas flaring once it continues beyond a 14-day period.
According to the agency, the permit was recalled and modified to include specific regulatory requirements for flaring of associated gas offshore Guyana, in accordance with the EPA’s legislation.
It was stated that due to technical issues offshore Guyana, ExxonMobil’s recently resumed gas flaring has been occurring intermittently since December 2019 and that the company was projected to exceed the 14 Billion Standard Cubic Feet per day (Bcf) of gas estimated to be flared under the Environmental Impact Assessment (EIA) for the project yesterday.
As a result of this the EPA and EEPGL engaged in discussion to address gas flaring issues.
Dumbfounded
Adams says that he is still dumbfounded as to why the EPA would mention that 14 bcf of gas was estimated to be flared when ExxonMobil itself has said that it was never catered for in the permit and it is the permit that the company has to be held to.
“It is astounding that the Government would so unashamedly attempt to use its own well- established bold-faced lie of the existence of a 14 billion cubic feet allowance for gas flaring, in the content of this release. Even ExxonMobil was forced to throw the Government under the bus by publicly distancing itself from such a blatant lie which only serves to further erode the credibility and trust of the people in what the EPA says or does,” he contended.
“The only apparent discernible, but scandalous reason for inclusion of this lie, is to cunningly legalize the 14 bcf, so that ExxonMobil won’t have to pay retroactive fees for this amount. This fine must be applied retroactively to this 14 bcf, since it was not allowed in the permit and not accounted for, in the EIA evaluation, and was all due to the full negligence of EEPGL,” he added.
ExxonMobil was asked by Stabroek News if it had mentioned to government a 14 bcf flaring provision in the permit, as Adams had told this newspaper that the company had sought to use the same argument last year. “No. We certainly have not. We are certainly aware of that number but we don’t view it as an allowance,” ExxonMobil Guyana President Alistair Routledge had emphatically responded.
He further explained that the 14 billion cu ft cumulative as stated in the EIA was used as an 18-month operational startup figure. “Eighteen months is a number included in the EIA. It is not in any of the permits, that number was generated by a third party… as an indication of what may be a possible under certain scenarios… It is not in the permit. It is not a permit limit. It was an estimation…,” he explained.
‘Spirit and intent’
Adams said that the company has to be held to “what is in the permit because that is what is allowed by law”.
And if ExxonMobil was insistent that excerpts of the EIA should be referred to, Adams said that they should be pointed to their own commitments as “ExxonMobil by its own words in accordance with the spirit and intent of the Permit and EIA, had said that there will be “no flaring from day one”.
He said that the modification to the Liza 1 environmental permit was a slap in the face to Guyanese and “the title of this modification should be more aptly `ExxonMobil given licence to pollute Guyana’”.
“This modification entailing a shameful Government and ExxonMobil’s concoction of a US$30 per tonne of carbon dioxide equivalent (CO2eq) for excess gas flared, has to be ranked as amongst the most barefaced uncaring act against the people of Guyana, and is nothing but a shiny mirage or a con of a paltry fine to distract from ExxonMobil’s continued immoral dumping of highly toxic substances into our environment with grave damage to our people’s health, safety and our environment; but which brings significant monetary benefits to ExxonMobil,” he said.
In addition to Adams, attorney and civil society advocate Christopher Ram has also criticized the EPA’s amendment as he said that that it is ambiguous and government also needs to say how the US$30 was arrived at. Pointed to also was the EPA’s lack of capacity for the oversight it said it would exercise.
“In fact, a reading of the Modified Environmental Permit shows that the payment applies only to flaring in excess of timelines for `flaring events’. Guyanese now wait with bated breath to understand what `excess of timelines for flaring events’ really means but clearly there is no longer even an attempt at the prohibition on flaring. It is unclear whether the EPA has the capacity or the equipment to measure the CO2 impact of flaring and even if it did, this measure is imprecise and inadequate,” Ram wrote in a letter to Stabroek News.
“At best, this can only be seen as a first and necessary step, but one undertaken without full statutory teeth. It would also be useful to learn how the amount of US$30 per tonne of CO2e was arrived at. There is no international benchmark: Professor Stern who was prominent in Guyana’s LCDS before the petroleum era, places that figure at US$85/tonne CO2e, while others have put it significantly lower,” he added.
Recommendation
Ram said that it also still remains unclear if Guyana would have to foot half of the US$30 per tonne CO2eq as per cost oil commitments under the Production Sharing Agreement with the company.
He explained, “There is also the issue of whether the polluter-pays-principle applies to this new measure. There are four levels of cost under section 3 of Annex C to the Petroleum Agreement: those recoverable without Further Approval of the Minister (3.1); those recoverable only with the approval of the Minister (3.2); those which are not recoverable (3.3); and those recoverable subject to the approval of the Minister (3.4). Penalties imposed by the Guyana courts are explicitly not recoverable while those imposed by regulatory agencies such as the EPA may seem to come under section 3.4. If the penalty is so allowed, then Guyana will bear 50% of the US$30 per tonne of Carbon Dioxide equivalent (CO2e).”
“This raises the issue of the stability clause of the Agreement which prohibits the Government from any changes to the Agreement without compensating Exxon for the additional cost,” he added while calling on the public to “stand up” against ExxonMobil.
Adams offered a recommendation that he says government should look impartially at. He suggested that to at least convey an impression of seriousness, the EPA must change the condition to ensure that “(1) This fine is applied to all flaring volumes above 48 hours (2 days); and (2) The EIA must be modified/updated to incorporate an evaluation of the new conditions caused by the newly extended flaring periods not considered in the original EIA.”
