The Environmental Protection Agency (EPA) announced on Tuesday evening (May 31, 2022) that it has renewed the Environmental Permit for Esso Exploration and Production Guyana’s (EEPGL) Liza Phase 1 Project within the Stabroek Block for a further period of five years. Once again, the permit holder, has been slapped with an increased fee for flaring via the Liza Destiny Floating, Production, Storage and Offloading (FPSO) vessel.
While the permit strictly prohibits routine flaring and venting, it now requires EEPGL to pay US$50 per tonne of carbon dioxide equivalents (CO2e) emitted as a result of flaring in excess of permitted periods.
Guyana Standard understands that this marks the highest sum to be levied in the event flaring is above stipulated limits, progressing from the US$30 fee that was first implemented last year.
Another major change in the permit pertains to financial assurance. EPA explained that the permit ensures EEPGL is held liable for all costs associated with clean up, restoration and compensation for any pollution damage. EEPGL is also required to have financial assurance from its parent company, ExxonMobil Corporation to “cover well control, and/or clean up and third-party liability on terms that are market standard for that type of coverage”. Additionally, the permit requires a Parent Company/Affiliate Guarantee Agreement which keeps Guyana indemnified in the event EEPGL and its Co-Venturers file for bankruptcy.
Finally, the permit makes provision for the targeted monitoring of the effects of effluent discharges such as produced water, bilge water, cooling water and grey water. The document now requires the submission of the effects of these discharges every six months. Further, EEPGL is required to submit safety case information, including a risk assessment prior to the drilling and development of wells.
