Despite questions and reservations, the Environmental Protection Agency (EPA) announced today that it has approved the Yellowtail development project, ExxonMobil’s fourth offshore oil well.
In a statement, the EPA said an environmental permit had been granted for a five-year period to ExxonMobil subsidiary Esso Exploration and Production Guyana Limited (EEPGL) to undertake the construction and operation of facilities. of production, within the Stabroek block, offshore French Guiana. The approval and granting of the permit was in accordance with the Environmental Protection Act Cap 20:05, he said.
“The approval comes after EPA has reviewed public input during all statutory periods for public comment and review. The EPA also considered the technical review and recommendations of a team of independent international experts and the Environmental Assessment Board (EAB). The EAB has reviewed and declared the revised EIS acceptable and provided recommendations for EPA approval under the environmental permit,” the statement read.
The EPA said the permit, as it is commonly called, comprehensively addresses all environmental and social safeguards that are reasonably necessary to protect human health and the environment; including the terms implied by Section 13 of the EPA Act.
The main provisions of the license are as follows:
Flaring – Like its predecessors, the permit strictly prohibits routine flaring and venting, and specifies that flaring is only permitted during commissioning, start-up, and special circumstances. The permit also goes further by maintaining payments in cases where flaring is carried out beyond authorized durations.
Oil Spill Response and Financial Assurance – Among the notable conditions, the permit requires EEPGL to procure a capping pile to be maintained, tested and stored in Guyana. A capping chimney is a large well closing device that connects to the top of the blowout preventer (BOP) and is capable of sealing a well. This is a form of modern technology (available after the Gulf of Mexico, Macondo incident) to plug a well in the event of loss of well control and blowout preventer (BOP) failure. In addition, EEPGL must maintain access to at least one (1) overseas subscription service, to enable mobilization of a recovery stack at the project location. This serves to enhance safety and emergency response efforts since the wells would quickly be clogged in the event of a blowout.
The permit also ensures that EEPGL is held responsible for all costs associated with cleaning up, restoring and compensating for any pollution damage that may occur as a result of the project. EEPGL is also required to have financial insurance which includes a combination of insurance which shall “cover well control and/or clean-up and liability under standard market conditions for the type of cover”, and a company parent/affiliate Guarantee agreement that indemnifies and keeps indemnified the EPA and the Government of Guyana in the event that EEPGL and its joint venture partners fail to meet their environmental obligations under the permit. In addition, the financial assurance provided must be guided by an estimate of the amount of reasonably credible costs, expenses and liabilities that may arise from any violation of this permit. Liabilities are considered to include costs associated with incident response, cleanup, remediation and monitoring.
Monitoring – Seeking to ensure that EEPGL meets its obligations to prevent and mitigate environmental damage, the permit imposes comprehensive requirements for the monitoring and management of any impact affecting the biological, physical and socio-economic resources in the area of influence of the project, including the targeted impacts. and updated environmental baseline studies. The license also requires EEPGL to submit safety case information, including a risk assessment prior to drilling and well development.
Grievance Mechanism – In addition, EEPGL is also requested to establish and maintain a grievance mechanism in line with the World Bank’s approach to grievance resolution in projects, to ensure that complaints from individuals and communities likely to be affected by the project are received and processed. There is a requirement to report this and what steps have been taken to address grievances to the EPA.