Peru oil disaster…Company fined for under reporting quantity of crude spilled, areas affected

Mar 16, 2022 News

Kaieteur News – More sanctions have been initiated against Spanish oil giant, Repsol, this time for the underreporting of the quantity of crude that was spilled from one of the company’s refineries and for allegedly reporting false information about the areas that were affected by the oil spill in Peru.
According to reports, the Environmental Assessment and Control Agency (OEFA), which is an agency attached to Peru’s Ministry of the Environment, has notified the oil giant about the new administrative sanctioning procedure for the alleged submission of false information in the Preliminary Report of Environmental Emergencies as a result of the oil spill that occurred in the Ventanilla Sea on January 15, 2022.

Images from the aftermath of the oil spill. [Photo credits: Getty Images, AFP, and Reuters]

The January 15 ecological disaster occurred at one of the La Pampilla refineries off the coast of Ventanilla in the region of Lima, Peru. It was reported that the spill was caused by shock waves from an undersea volcanic eruption near Tonga in the South Pacific Ocean. At the time of the undersea eruption, Suezmax tanker, Mare Doricum, was offloading a shipment of Brazilian crude oil at one of La Pampilla refinery’s offshore mooring buoys, and as such, a quantity of the cargo was released.
Repsol had underreported the quantity of crude that was spilled to the OEFA stating that only 0.16 barrels of crude was spilled, and affecting an area of 2.5m2. However, later investigations by Peru’s OEFA revealed that more than 10,000 barrels of crude had spilled – more than double the amount initially reported by the company and the affected area reaches a size of 11,061 hectares.
For this type of administrative infraction, the oil giant can be fined up to US$1,232,417 – for reporting false information to the OEFA.
In a recent press statement, the OEFA, an environmental monitoring authority, reaffirmed its commitment to continue to carry out daily monitoring and impose the respective sanctions when detecting non-compliance by Repsol.
To date, the OEFA has initiated administrative sanctioning proceedings against Refinería La Pampilla S.A.A. (Repsol), whose fines could exceed 59 million soles (US$15,849,562) for the following violations: failure to comply with the administrative measure to identify areas affected by the spill; failure to comply with the administrative measure to clean-up all the affected areas; failure to comply with the administrative measure for the containment and recovery of hydrocarbon; and presentation of false information in the Environmental Emergencies Report.
Administrative sanctioning procedure is to determine whether there is administrative responsibility for non-compliance with an environmental obligation that can be audited, the consequence of which is the imposition of a sanction.
In previous reports, Peru’s Minister of Environment, Modesto Montoya, had stated that Repsol was not fulfilling its obligations in relation to the cleaning and remediation of the aftermath of the spill, specifically in the islands off the coast of Peru. As a result of the oil company not fulfilling its obligation in Peru, the Minister pledged that the Peruvian government will use all of the State’s power to prevent irresponsible companies from polluting their environment.
In light of the difficulties the Peruvian government is having with Repsol, to clean-up the oil spill that contaminated their shores and water, the Minister had also cited the importance of legislative reform to adequately deal with companies after oil spills.
Kaieteur News reported that following the devastating oil spill, several Peruvian officials had called for the oil company to offer compensation for the disaster.
The first action taken against the company was by Peruvian judge, Romualdo Aguedo, on Friday, January 28, 2022, who granted the order to prevent four Repsol’s executives from leaving the country. Peruvian media reported that Judge Aguedo imposed an 18-month ban on the grounds of the potential risk that the officials might leave Peru. Among them were: refinery manager, Jaime Fernández-Cuesta Luca de Tena; terminal manager, Renzo Alejandro Tejada Mackenzie; environmental manager, Gisela Cecilia Posadas Jhong and production manager, José Gregorio Reyes Ruiz.
In taking additional steps, Peru’s former Minister of the Environment, Rubén Ramirez on Monday, January 31, 2022, revealed that the government had taken the decision to suspend the company’s hydrocarbon loading and unloading activities. In other words, Repsol’s operation in the country was halted until it can substantially prove that another oil spill will not occur again in its waters.
However, in an update it was revealed that a fuel shortage in Peru had forced the country’s OEFA to lift the suspension on Repsol’s operation temporarily. However, the company was only allowed to continue its operations for 10 days and under supervision from the OEFA. That 10 days period has since come to an end and the Peruvian government has signalled that it has other alternative sources to obtain fuel.
The clean-up and remediation of approximately 12,000 barrels of crude that contaminated the shores and waters of Peru is expected to cost some US$65 million – this was announced by Repsol’s Chief Executive Officer (CEO), Josu Jon Imaz.
As the Government of Peru takes action to protect its people and its environment, Guyana in contrast, continues to give American oil giant, ExxonMobil, permission to operate without full coverage insurance to cater for such a disastrous oil spill. In February, last, ExxonMobil announced that it has commenced oil production at Guyana’s second offshore development area called Liza Phase Two in the Stabroek Block.
Among the oil companies working in Guyana’s backyard is the very oil company –Repsol – that caused the oil spill in Peru.