EPA’s Response to Stabroek News and Kaieteur News Articles on the Environmental Permits for the Liza 1 and Payara Development Projects

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July 02, 2021 - The Environmental Protection Agency (EPA) strongly disagrees with the Stabroek News article titled: “Payara clause could allow Exxon to flare gas for free” published on Monday June 28, 2021, and Kaieteur News article titled: “Govt has weakened environmental standards in favour of ExxonMobil” published on Friday July 02, 2021.

The EPA takes this opportunity to categorically state that flaring for sixty (60) days is only permissible for “Start-up” in both permits. International benchmarking shows that the typical acceptable start-up period for installations of this nature average 90 days; therefore the EPA’s 60-day requirement is much more stringent as it is well below the average international benchmark. As far as the EPA is aware, there was never an agreement to prescribe two (2) days of start-up since this was impossible given the nature of the installations.

Further, it is erroneous to contend that there is “no provision to stop flaring after sixty days” since both permits specifically state: “The Permit Holder shall not exceed sixty (60) days of flaring during Start-up.”

Moreover, there is no “carte blanche” for flaring under ‘Special Circumstances’ either, as the company is required to seek approval from the EPA for any flaring beyond 48 cumulative hours. Routine flaring and venting are also strictly prohibited by both permits.

The EPA maintains and reserves the right to reject any request for flaring made pursuant to these Permits and if an approval is given, the EPA may include such terms and conditions as may be appropriate, including reduced timelines for any proposed flaring events.

Pursuant to Condition 3.17 of the Payara Environmental Permit, the EPA has established a payment for CO2 equivalent emissions as a result of flaring at the rate of USD$30 per tonne of CO2e, consistent with similar mechanisms included in the modified Liza 1 Permit. The institution and applicability of this payment is determinable by the EPA, in consideration of the Polluter Pays Principle. The EPA also reserves the right to increase this rate where any instance of flaring exceeds sixty (60) days.

The EPA noted that the Stabroek News article reported that the thirty-six (36) day period approved for flaring under the Liza 1 Modified Environmental Permit had expired. However, the EPA assures the public that at the date of the article’s publication, the approval issued to the company was still in effect. The Modified Permit requires that the payments be made to the EPA within twenty-eight (28) days of the expiration of the approval in order to ensure it is calculated based on the actual volumes as well as sound internationally-recognised methodologies. 

To this end, the EPA refutes any allegations that it lacks the requisite capacity and capabilities to perform the necessary calculations. The EPA boasts a wide variety of professionals qualified in environmental management, chemistry, engineering and other pertinent fields, and recruits additional expertise, local and international as necessary.

The EPA views the Payara Environmental Permit and the Modified Liza 1 Environmental Permit as marked improvements, particularly in consideration of the more specific flare management conditions that are consistent with industry practice in order to regulate and/or deter periods of flaring. Specifically, the Payara Permit was a major improvement in that it also included provisions for produced water management, cradle to grave waste management, insurance requirements and reporting mechanisms; which were notably absent from the Liza permits. 

The EPA wishes to assure the public that it has pursued, and continues to pursue environmental safeguards and deterrent mechanisms to address any prolonged periods of flaring which may pose risks to the environment, consistent with best-practice and international standards.