Op-Ed: Fifth oil project – a confluence of circumstances

Jan 18, 2023 Features / Columnists, News, The GHK Lall Column

By GHK Lall

Kaieteur News – Guyana’s fifth oil project, Uaru, could turn out to be a killer. I don’t see how it can’t be, when the local environment is considered, and the now settled culture in which Exxon operates is studied, and the nature of the main people that the company deals with at arm’s length.

There is a 3178-page Environmental Impact Assessment, which I have. It has an extensive table on page 98 that is titled EIS-8: Summary of Residual Impact Significance Ratings, Residual Risk Ratings, and Cumulative Impact Priority Ratings, which is reproduced in part below.

Note that these resource areas were self-selected, meaning handpicked, to highlight a few points. I will not question methodology, or conclusions. But I use them alongside the record of oil companies in weak countries, and Exxon’s own torrid history of risk-taking.

In normal circumstances, the ratings of “moderate” and “medium” would prompt a pause, some pondering. But the theater in Guyana is anything but what could be called “normal.”

GHK Lall

Our relationship with Exxon, our inarguable reality, is lopsided. Lopsided deal, one-sided partnership, and which blindsides Guyanese unceasingly. There is a weak, likely compromised, now undeniably ineffective PPP Government standing as our oil stewards; leadership is frail and fearful. The attitudes and actions of national leadership are hands-off and highly helpful to Exxon’s interests. We have our most crucial institutional, the Environmental Protection Agency, embodying a watchdog that shrinks from growling, confronting, and lunging at the excesses and abuses of Exxon. Guyana’s EPA has built a doghouse for itself, and locked itself safely inside. Considerable assistance was rendered by the PPP Government to ensure this impotent condition. We live with, and Exxon prospers from, an absence of any degree of constant, robust scrutiny.

This is the Guyana’s side of Exxon’s bargain, through what is this perfect confluence of local circumstances, arrangements, and developments, and it is fabulously rich for Exxon.

In terms of an operating environment, Exxon has an ocean as its unlimited playground. Exxon has no restraining margins of operation, no maritime borders that it cannot cross no tides that stand against or swirl around its sprinter’s run for numerous finish lines. One is profits. Another is speed. Still another is corporate thrift, viz., cost minimization. One more is squeezing the clock to extract the most out of every working minute. Under Exxon’s aggressive regime, 24/7 is turned on its head, torn to shreds. Time is tight, with no speed limits, like the outer lane on the German autobahn. As if in unholy acquiescence, and shameless confirmation, Guyana’s President Ali went to India to remind all of the swiftness that Guyana produces oil.

That is worrying. Too many wells are clustered too tightly, with Guyana having no say. We could be in for a seismic shock beside the normal ones. The concentration of Exxon’s network of wells may be unprecedented, and unequalled, anywhere in oil exploration and production realms. Regarding costs and the compression of the clock into the unrecognizable, I recommend that Guyanese reacquaint themselves with the catastrophic failures at the Deepwater Horizon offshore oil rig in the Macondo prospect. Matters reduced to this: cut corners to earn, and deep burns result. Or, to employ presidential verbal coinage: step on the accelerator. Just ensure that a defibrillator is around.

Presently, we have this all but officially approved, and publicly announced, fifth oil project, Uaru. The EIA has informed that mitigating measures are in place to minimize risks. Yet we have had repeated gas compressor failures, excessive flaring, and a reported single barrel oil spill, still a national mystery. In sum, we don’t know what we don’t know. Exxon is not famous for precautions, or confessions, when disaster strikes. The Exxon Valdez offers raw testimony. Otto Harrison, Exxon’s man in Alaska told the Coast Guard Commander sent by George W. Bush and John Sununu that “This is going all the way to the White House” when he didn’t get his way. The White House recalled Commander Yost. Captain Joseph Hazelwood never was penalized, and Exxon exhausted the American court system, to drain damages originally awarded.

Given our government, institutions, and Exxon’s unchecked freedoms, its risk-taking readiness, its corner cutting (to profit slyly), I have news for Guyanese. Moderate and medium risks/impacts have sharper, more alarming complexions when Exxon is the operator, and offshore Guyana is the playing field. Because moderate and medium, with Exxon piloting the way forward, has the great probability of seamlessly extending into high risk and impact for Guyana. We could be in for trouble, and not of the moderate or medium variety, given Exxon’s predilection for cheapness, risk-taking. It is a perfect confluence of circumstances.

The views expressed in this article are those of the author and do not necessarily reflect the opinions and beliefs of this newspaper and its affiliates.)