Guyana’s High Court Judge, Justice Sandil Kissoon today ruled that ExxonMobil’s affiliate and Stabroek Block operator, Esso Exploration and Production Guyana Limited (EEPGL) is in breach of its insurance obligations for the Liza Phase One Project. In his ruling, Justice Kissoon ordered that Exxon furnishes Guyana with a parent guarantee as well as an environmental insurance liability from EEPGL from an independent firm. If this is not satisfied in 30 days, the permit for the Liza Phase One Project could be suspended.
Importantly, the High Court Judge said this state of affairs where Exxon and its subsidiary did not meet the outlined requirements was a direct result of the negligence of the Environmental Protection Agency (EPA).
Justice Kissoon in his ruling said the EPA has abdicated the exclusive statutory responsibilities entrusted to it by Parliament under the Environmental Protection Act 1996 and the Environmental Protection Regulations 2000 to ensure due compliance by EEPGL on matters of insurance.
Justice Kissoon said, “The EPA has relegated itself to state of laxity of enforcement and condonation compounded by a lack of vigilance thereby putting this nation and its people in grave potential danger of calamitous disaster.”
In the course of these proceedings which were initiated last year September by two Guyanese, Frederick Collins and Godfrey Whyte, the Court found in the evidence before it that EEPGL was “engaged in a disingenuous attempt which was calculated to deceive when it sought to dilute its liabilities and settled obligations stipulated and expressed in clear unambiguous terms” in its permit.
The Court also found that EEPGL was never in doubt as to what its liabilities are as captured the Environmental Permit ( Renewed) for the Liza Phase 1 Petroleum Production facility as the stipulations were neither unusual, unique or unauthorized.
“It was simply as a matter of law, fact, and consequence that prevails which bound ESSO as singularly and exclusively responsible for all liabilities without restriction, implied or expressed, from its operations at the Liza Phase 1 Petroleum Production facilities, in the Stabroek Block offshore Guyana.”
The judgment also noted that the EPA had refused to disclose any information as to the status of compliance by EEPGL with its financial assurance obligations for pollution damage. The agency, according to the ruling, sought refuge in “silence, avoidance, concealment and secrecy” notwithstanding the grave potential danger and consequences to the State and citizens if a disaster occurred at the Liza Phase 1 Project in absence of such financial assurances.
The lawyers at the helm of winning this landmark case are Seenath Jairam S.C., Melinda Janki and Abiola Wong-Inniss.
