Exxon shuts down Norway refinery after country strengthens rules governing industry

Jul 27, 2021 News

…as Guyana relaxes guidelines for environmental permits

Kaieteur News – Evolving regulatory measures governing the oil and gas industry are among the reasons being cited by US Oil Major, ExxonMobil, for a decision to shutter its refinery in ‘climate friendly’ Norway, according to recent international reports.
Argus International News over the weekend reported in a Benedict George article, that the decision by the US oil major was taken to shutter the refinery permanently, since, according to ExxonMobil in an April 2020 announcement, the refinery’s continued operation, “is not economically viable over the long term because of strong competition, evolving regulatory measures, and falling demand.”
The 120,000 barrels per day (b/d), Slagen refinery in Norway was shuttered this past month leaving state-controlled Equinor’s 200,000 b/d Mongstad plant as Norway’s only refinery.
The decision by ExxonMobil to shutter its Norway facility over, among other things, evolving regulatory measures, comes as the company continues flaring in the Stabroek Block from the Liza Destiny Floating Production Storage and Offloading vessel.
This, in addition to an evolving public debate in relation to the guidelines being utilised by the local Environmental Protection Agency (EPA), with regards its guidelines being used with regards authorisation or permits for projects such as oil field developments.
New guidelines had been issued six days before ExxonMobil’s Guyana Subsidiary, Esso Exploration and Production Guyana Limited (EEPGL) submitted an application for a gas pipeline for government’s gas-to-energy initiative.
The new guidelines have since been the subject of intense public condemnation, especially since the EPA conceded that the new guidelines did not include measures to cater for onshore gas projects, in addition to other favourable provisions for the operator and not the country at large.
The EPA on June 22, 2021, announced that it had taken the decision to withdraw the Revised Environmental Impact Assessment (EIA) Guidelines (2020) for Mining, Forestry, Hydropower, Thermal Power, Electricity Transmission and Offshore Petroleum Exploration and Production.
It has opted instead to use guidelines from two decades earlier, which is—the EIA Guidelines (2000) Volumes 1-5 (Generic; Forestry; Mining; and Electricity Generation).
The changes were had six days before the EPA announced that ExxonMobil applied for environmental authorisation for the US$900M gas-to-energy project, while adding that it requires the company’s local affiliate, EEPGL, to conduct an EIA before it considers giving approval.
The EPA has since claimed that shelving the guidelines will not affect the quality of the EIAs at all. The EPA said this in a media release on Thursday last, following articles by Kaieteur News.
This newspaper pointed out that the removal of the guidelines was done just six days before the agency announced a requirement for ExxonMobil to conduct an EIA for the US$900M gas-to-energy project. This is an indisputable fact.
Furthermore, the agency had said that it withdrew the guidelines to conduct consultations with stakeholders. They are called Revised Environmental Impact Assessment (EIA) Guidelines (2020) for Mining, Forestry, Hydropower, Thermal Power, Electricity Transmission and Offshore Petroleum Exploration and Production.
In the meantime, the regulator believes it wise to use guidelines from 21 years ago, called EIA Guidelines (2000) Volumes 1-5 (Generic; Forestry; Mining; and Electricity Generation).

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