ExxonMobil and EPA breaching transparency guidelines by hiding flaring data from Guyanese – Alfred Bhulai

Aug 01, 2022 News

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Kaieteur News – Former Transparency Institute Guyana Inc (TIGI) representative, Alfred Bhulai is flagging a breach of transparency guidelines by not only the oil giant, ExxonMobil but also by the regulatory body, the country’s Environmental Protection Agency (EPA).

Bhuali sought to explain the sole purpose of the EPA should be to protect the environment, however the body seems to have added an extra duty- to look out for the oil operator.

Over a year ago, Bhulai himself wrote to the EPA requesting data on offshore flaring. Flaring, as the word suggests, is the process of burning associated gas that is brought up during oil production. Notably, this process emits harmful gases into the atmosphere that can, not only affect seabirds and marine creatures, but also climate change. In addition, it must be noted that there are alternative options available to the oil company to avoid flaring, such as gas re-injection, however Exxon has publicly made it clear that it is cheaper for the company to flare the associated gas, rather than re-inject it into the wells.

To that end, Exxon’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), is required to pay a fine of US$50 per tonne of carbon dioxide released from flaring. It was on Tuesday that the Production Manager at ExxonMobil Guyana, Mike Ryan told members of the media fraternity that the company was finally able to bring an end to the gas compressor woes that plagued the Liza Destiny floating, production, storage and operating (FPSO) vessel at the Liza One field.

The equipment encountered technical issues soon after the startup of oil production in 2019. Since then, the operator has been flaring natural gas offshore Guyana.
Bhulai in an interview with this newspaper on Saturday explained, “Every barrel of oil has a certain amount of gas, let’s say 1000 cubic feet of gas associated with it, so all you have to do to keep within the flaring limit is to cut down the number of barrels being brought up from the wells, but they are not willing to do that.”

But in addition to Exxon’s unwillingness to cut back on production, the transparency advocate argued that the EPA has put provisions in place to allow the rampant environmental damages. He was referring to a clause that was added to the Liza One Permit, which gave ExxonMobil Guyana the green light to flare associated gas as it pleases, once its equipment was under maintenance.

In exchange for the environmental harm caused by flaring, the EPA introduced a US$50 fine for flaring of gas. From the time Exxon encountered difficulties with its gas compressor to July of this year, a total of US10 million in flaring fees have been paid over to the EPA. However, both Exxon and the EPA are reluctant to declare the total amount of gas that has been flared to date.

Bhulai is certain that the oil company is deliberately hiding this information from the public as it would contravene safety levels that it would be required to adhere to. With the kind assistance of the country’s Environmental Protection Agency, Bhulai an Energy Technologist said that this very act is a breach of transparency regulations.

He said, “They EPA has now allowed them to flare during maintenance which is something undefined so they can very well and in fact they do, it’s obvious cause they have paid US$10 million in fines, so what they are doing is simply flaring and of course they do not want to tell you how much it is because it contravenes the best practices…the EPA is not supposed to be hiding this information from the public but they are on the side of the oil company.”

Bhulai was keen to note that a flaring fee “is no achievement” but rather serves as an incentive for ExxonMobil to continue harming the country’s environment. According to him, “Exxon is paying like US$12,000 fine per day, with the extra number of barrels of oil being brought up they make about US$500,000- that is far more than US$12,000- so in other words they are really incentivizing Exxon to flare. That is really why they can’t or don’t want to tell you how much they are really flaring.”

He concluded that the EPA is clearly on the side of Exxon, as it has chosen to shield the oil company by not disclosing the total amount of gas flared. Exxon’s Production Manager, when he was asked how much gas was flared in the period, carefully dodged the question. Ryan would only repeat that the company maintained full compliance with the EPA’s permitted parameters for flaring which was between15-7 million cubic feet of gas per day. Commenting on this statement, Bhulai told Kaieteur News that the oil company could only boast of being compliant as it directed the EPA to set the specific provisions in the Permit. “The oil company is saying they are compliant, they are only compliant because they have told EPA to set that order,” he said.

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