The Environmental Protection Agency (EPA) has approved the contentious US$1.3 billion gas-to-energy project, including ExxonMobil’s development of a natural gas transport pipeline, a materials offloading facility and natural gas liquids plant.
In a notice to the public posted on its website on Friday, the EPA said approval of the project was based on the following grounds:
“1. The Environmental Assessment Board reviewed and declared the Environmental Impact Statement and Environmental Impact Assessment related to this project, acceptable in accordance with section 11(13) of the Environmental Protection Act, Cap. 20:05.
“2. The EPA is satisfied that the project can be conducted in accordance with good environmental practices, and in a manner that avoids, prevents and minimizes any adverse effects which could result from the activity.
“3. The technical reviews and recommendations from a team of independent International Experts, the public inputs at the scoping stage, views expressed by members of the public during consultations, the submissions made after the EIA was submitted for public review, and all other relevant considerations, indicate that the project is environmentally-sound and in the public’s interest.”
Additionally, the EPA has already granted the permit to ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), for the project and indicated that the company will be liable for all cost associated with any damage as a result of pollution and flaring will be penalized.
In the permit published on its website and seen by this newspaper, the EPA said that the permit holder (EEPGL), must provide within a reasonable time of signing the permit financial assurance to cover all legitimate liabilities outlined in the permit.
EEPGL must provide insurance in accordance with the international petroleum and natural gas industry and which covers the cleanup and third party liability on terms that are market standard for the type of coverage, and a parent company or affiliate undertaking that provides indemnification for liabilities under the permit.
According to the permit, signed by ExxonMobil Guyana’s Country Manager Alistair Routledge, “the Permit Holder, his Servants and/or Agents shall be liable jointly and/or severally for any gross negligence or willful misconduct to the marine environment, biodiversity, protected species and natural habitat with respect to any release or discharge, spill, contaminant fluids, oil or lubricants any facilities permitted under this Project. The Permit Holder, his Servants and by Agents shall be liable jointly and/or severally for environmental damage due to pollution from its activities within Guyana, its territorial waters, contiguous zones, continental margins continental shelf, and Exclusive Economic Zone, inclusive of damage to the marine environment, biodiversity, protected species and natural habitat with respect to any release or discharge, spill, or contamination which is attributable to the Permit Holder and his agents or contractors. This is in accordance with Section 49 (1) of the Maritime Zones Act 2010 and is subject to any other existing or forthcoming laws, regulations and standards governing the protection of the marine environment.”
By signing onto the authorization, the company is committing to following all environmental guidelines, regulations and best practices in accordance of the Environmental Act.
The project received the much needed approvals on Friday from Head of the Agency Kemraj Parsram. The permit is valid for five years and will expire on November 24, 2027. EEPGL must apply for a renewal six months prior to the expiration of the permit.
With a cheaper energy alternative, government hopes this project will lead to vastly lower energy costs and spur growth in the manufacturing sector.
EEPGL filed its application for environmental authorization in early 2021 and it was subsequently amended. Following a review by the EPA, it was decided that an EIA would be required before the project moved ahead. That process commenced with public engagement on the scope of the study as well as the proposed terms of reference.
On September 21, 2021, the EPA approved the final terms and scope for the EIA after which EEPGL was tasked with hiring a qualified independent environmental consultant to conduct the EIA for the project. The terms for the EIA were not published. The EPA, in accordance with the Environmental Protection Act, approved Environmental Resources Management (ERM) as the executor of the study.
It was anticipated that with all relevant permits granted, the project would have commenced in August 2022 but that was not possible as the environmental permit was only signed two days ago.
Natural Gas Liquids Plant
The EPA in the permit said that the company is required to submit a detailed Methane Emissions Monitoring Plant for review and approval. This must be done six months prior to the start-up of the plant.
EEPGL was informed that routine flaring for the project is prohibited and will only be allowed in the startup and venting commissioning stage of the operation.
“Routine flaring and venting are strictly prohibited. For the purpose of this Permit, pilot and purge gas, storage bullet and loading rack emissions, tank flashing emission, standing/working/breathing losses, low pressure streams are not taken to constitute routine flaring and venting. Flaring and venting are only permissible during commissioning, start-up or special circumstances …,” the EPA outlined.
Under the regulations, the EPA stated that the developer shall not exceed 60 cumulative days of flaring. It stated that any day gas is flared above background flare levels regardless of the duration it will be counted as a day.
EEPGL is required, according to the permit, to inform the EPA of its expected duration of flaring and volumes during the startup and commissioning of the project at least six months prior. This is necessary for approval.
The EPA informed that where flaring is expected to exceed 60 cumulative days, EEPGL must seek an approval not later than five days prior to the end of the period. In the application for an extension, EPA said the company must provide a schedule for flaring, daily projected volumes, justifications for extension and description of conditions for the activity.
The company will also be required to notify the EPA of special circumstances that led to flaring for more than 12 hours. This must be reported in a 24 hours’ timeframe to the EPA.
“With the exception of the background flare, where any of the abovementioned Special Circumstances is expected to exceed fourteen calendar days, the Permit Holder shall seek Approval from the Agency for flaring within the first 96 hours of the commencement of flaring,” the EPA outlined.
According to the permit conditions, the company will be subjected to fines of $50 US for every tonne of carbon emitted exceeded after the initial sixty days and special circumstances. EEPGL will be required to submit Emission Report Calculations Reports within 28 days from the expiration of the approval. Payments must be made within 14 days of the EPA approval of the calculations.
A consolidated record of all flaring events, regardless of volume and duration including start and end times, meter calibrations and maintenance records commencing from the commission throughout the duration of the permit must be maintained.
In the construction and maintenance of the plant, EEPGL is expected to “construct and maintain a Process Waste Water Treatment Plant (PWWTP) that complies with World Bank Indicative Values for Effuents Levels for Natural Gas Processing Facilities… through which all contaminated wastewater generated by the NGL Plant and its supporting operations including potentially contaminated storm water from process area storm water drainage (such as loading racks, flares, compressor drains and substation areas) must be routed… They shall conduct routine inspections to confirm the PWWTP is working according to design specifications and monitor the following parameters in each effluent,” the EPA stated. Monitoring shall be done every six months.
Touching on spills and emergency management, the EPA said the developer must ensure the plant is equipped with an internal alarm system or communications system capable of detecting and reporting immediate emergency instructions to facility personnel.
However, Under the permit agreement, EEPGL is required to among other things comply with instructions from the EPA related to the protection of the environment in Guyana and surrounded regions in South American and the Caribbean likely to be affected by any disasters.
Mishaps or spills
The permit states that EEPGL is required to inform the EPA of any discovery of mishaps or emergency spills within 12 hours offshore and three hours onshore.
“The Permit Holder shall complete and submit an “Incident Notification Form for Spills and Emergencies in Onshore Operations” or an “Incident Notification Form for Spills and Emergencies in Offshore Operations” using the most recent template to the Agency, within forty-eight (48) hours of any discharge of contaminants amounting to five (5) gallons or more. A follow-up incident notification form shall be completed and submitted within seventy-two (72) hours of the submission of the initial notification form ha total of five days after the discharge of contaminants)… on a monthly basis, all near misses, spills and unwanted or accidental discharges, amounting to less than five (5) gallons,” the permit stated.
The company is also required to design and maintain an emergency response management plan outlining procedures to be followed in the event of NGL plant or pipeline malfunction, actions to be taken to respond to fires, explosion, and unplanned sudden or non-sudden release of hydrocarbon or hazardous waste among others.
EEPGL in its execution of the project will be required to ensure all its onshore and offshore contractors are authorized by the EPA to conduct any work in the development of the project for which the permit was granted.
The developer will also be required to submit to the agency a Terms of Reference for approval the preparation of the updated environmental and social baseline. This is due within sixty days of signing the permit and within one year of the EPA’s approval EEGPL is mandated to submit an updated environmental and social baseline report.
As a part of the agreement, the company is required to conduct integrity tests on the pipeline and the NGL Plant prior to the commencement of operations and at regular intervals in keeping with good international industry practice (GIIP) during the lifetime of the Project.
“All tests shall be documented, which documentation shall include but not be limited to a clear indication of the scope and objective of each test, type of test conducted, the test methodology and test results. The information shall be made available to the Agency upon request,” the agreement that was published on the EPA website states.
Also the developers are required to develop and implement a project specific Stakeholder Engagement Plan (SEP). The plan, the EPA said, should include measures for continued engagement with communities aimed at increasing awareness of the nature of the Project, and the measures in place to prevent, avoid, and mitigate environmental and social impacts and emergencies/accidents.
“The Permit Holder shall submit the SEP to the Agency prior the commencement of any Project activity. The Permit Holder shall commence engagement in accordance with SEP prior to the commencement of construction and The Permit Holder shall monitor the frequency of engagement with stakeholders, including fisherfolk communities, vulnerable groups, Indigenous populations, users of the water bodies, and farmers within the area of influence.”
Additionally, the company will be required to submit summary report of engagement with stakeholders as a component of the Annual Report.
“The report must include but not be limited to the date of each stakeholder engagement, the location, the objective of the engagement, and key comments and concerns raised.”
The EPA said as the authoritative body on environmental regulations, it reserves the right to request any additional details of stakeholder engagements.
It was further stated that the developer is expected to implement and maintain a transparent, accessible, and consistent Community Grievance Mechanism (CGM), prior to the onset of Project activities.
“The Permit Holder shall ensure that the CGM is in keeping with the World Bank’s Approach to Grievances Redress in Projects and take measures to promote the CGM, and ensure that it is widely publicized and understood by the public… they shall track the number and type of grievances received and resolved by the CGM, and adjust the CGM and other management measures on an ongoing basis, as appropriate and shall prominently display the contact information for the CGM throughout the life of all phases of the project,” the permit stated.
Construction Management
EEPGL will also be required to repair all thoroughfares damaged in the execution of the development and work with the National Trust of Guyana should they find or come across any heritage or cultural resources.
EEPGL has also been mandated to implement a road safety management plant prior to the commencement of construction of activities by identifying travel routes for ground transportation, develop a logistics journey plan to reduce conflicts with local traffic when transporting goods and avoid deliveries on the harbour bridge during the peak hour, among other things.
The EPA also informed that in the laying of pipes, the company should simultaneously install a fibre optic based system to detect leaks and possible third party intrusion.
In the construction phase, the EPA outlined that all oils, fuel, paints, chemicals and stockpile materials must be located at least 30 meters away from the Demerara River or other water bodies in the environs of the project site.
Moreover, the company will be required to seek approval from the EPA for the removal of mangroves during the construction phase.
Reminding the company that mangroves are protected by law, the EPA in its permit said EEPGL must seek permission from the agency at least seven days before planned removal.
EEPGL is also prohibited from discharging any contaminants into the environment unless authorised in accordance of the GIIP. They must also ensure that any activity that creates an impoundment to the flow of water be minimized.
Additionally, in regards to the installation of the offshore pipeline, the permit states that EEPGL must engage in steady consultation with stakeholders.
It specified that the company proactively meet with artisanal fishers during in advance of the construction and advertise a cut-off date for all fisher folks to remove their fishing equipment from the near shore project execution zone.
The project developer must ensure that the project is equipped with leak detection mechanism and monitoring systems in accordance with GIIP. Such system must be in place for the equipment, treatment, storage facilities and on applicable project vessels.
While they are required to utilize only the Offshore Chemical Notification System Gold Standard hydrostatic test chemicals to test the pipelines, they are required to seek permissions from the Pesticide and Toxic Chemical Control Board for the requisite permits.
Also the company will be required to report any accidental release of waste into the marine environment within 24 hours and immediately implement corrective action.
“The Permit Holder shall ensure that monitoring of marine mammals, riverine mammals, marine turtles, and rafting marine birds are undertaken on board all Project vessels. The Permit Holder shall maintain a record of all detections of marine mammals, riverine mammals, marine turtles, and rafting marine birds, and submit same to the Agency in the Annual Report,” the permit outlined.
It was also outlined that the developer should monitor the activities of micro invertebrates, fishes and water quality at a baseline survey for a year during the development of the project and every three years after plant becomes operational.
