Media should report on how oil developed countries rather than focus on likely damages from oil spill in Guyana – President Ali

Apr 02, 2023 News

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Kaieteur News – While moving at a break neck pace, approving projects in half the normal industry time, and permitting the operator of the Stabroek Block to produce oil above the safe operating limits, Guyana’s leaders have taken an approach to focus on the positives, rather than the likely dangers associated with the sector and are now encouraging the media to do the same.

President Irfaan Ali at a press conference at the Leonora Track and Field Centre on Friday while responding to a question from this publication said 99 percent of the times, reports from this organization are negative.

Ali said it is important to recognize the benefits to be had from the industry and the media should in fact report more on these “positive examples”.

The President was asked to explain what policies or mechanisms are being put in place to address a possible spill that can occur in the 26,800 square kilometers (6.6 million acres) Stabroek Block, since Environmental Impact Assessments (EIAs) conducted by ExxonMobil have so far warned that such an incident that can affect as many as 14 Caribbean islands. See link below https://www.kaieteurnewsonline.com/2023/03/08/14-caribbean-islands-could-be-impacted-by-oil-spill-from-35-well-drilling-campaign-exxonmobil-study/

The question came as a follow up to the Head of State’s statement that government is tasked with a heavy responsibility of ensuring policies are implemented to support the investments made in the country.

He said, “We have a responsibility to ensure the success of these investments; we have a responsibility to ensure that policies are crafted to support these investments. You see we don’t have the luxury of writing headlines. We don’t have the luxury of managing for headlines. We have to manage for the country and in the interest of the country.”

When the President was however asked to say what policies are being put in place by his administration to respond to spill which can have transboundary impacts, he urged that the newspaper focus on the positive outcomes of petroleum production instead.

According to Ali, “In life you could be negative or positive. For over 100 years Trinidad and Tobago produced oil; 108 years Trinidad and Tobago produced oil. Trinidad and Tobago grew with oil. I have never seen the people of Trinidad and Tobago advance argument that is negative to the development of that sector over the years. We could build on assumption, positive or negative, what if is the big question.”

The President acknowledged that a critical component of the oil and gas sector is to ensure “in the infrastructure landscape, care is taken in ensuring the relative capability to respond to the multidimensional challenges of oil and gas is there.”

He explained that he recently toured a local shore base where he saw firsthand a specialized warehouse stocked with equipment designed to specifically “deal with issues like these…”

Ali went on to say that he urged the Shore Base to arrange for study tours to allow the media access to the facility to be aware of the scale of investment supporting the industry.

The President therefore argued, “The very people who speak about oil and gas and what it can do and cannot do for us…a lot of people who talk about what we do here, they will come to me in the same breath and say look at the transformation in Dubai, in Kuwait, in UAE, in the United States major supplier of natural gas now, they will use all of these examples in Kazakhstan, in Norway, there are hundreds of positive examples out there that you can use to show what oil and gas can do for the transformation of a country.”

“There are also a lot of negative examples and I read your news all the time and most times, 99 percent of the times you go for the negative example. You go for the failure. You can choose the failure or the success. There are many success stories that we can use as example, why don’t we grab on to them,” he added.

Ali said he supports the idea that the country must plan for any eventuality, however Guyana is still in the development phase unlike more mature jurisdictions that are yet to implement such safeguards.

He said, “We are shortening the learning curve by looking at the worst practices and the best practices and ensuring that we put into system a functional policy that would allow the growth but also the safeguard.”

The Head of State urged, “When you are making policies the policies must be balanced to attract investment but at the same time ensure consumer rights are protected…the local environment is protected, creating balance.”

Oil production

Oil production in February peaked at 402,000 barrels in one day at the two operational Floating Production Storage and Offloading (FPSO) Vessels, in the Liza One and Liza Two projects, offshore Guyana.

According to the Ministry of Natural Resources Oil Production Data Centre, Liza Destiny produced 156,000 barrels on February 24, 2023; while the Liza Unity produced 246,000 barrels on that day.

It must be noted that the EIAs done for the two projects cite 120,000 barrels and 220,000 barrels respectively for Liza One and Liza Two.

Both projects are now operating above the prescribed safety levels but ExxonMobil maintains that the necessary infrastructural work was done to ensure the activities are carried out safely.

At the same time, Guyanese have voiced their concerns that the ramped up production of oil can expose the country to a greater risk of an oil spill.

In fact, former head of the Environmental Protection Agency (EPA), Dr. Vincent Adams had equated the increased oil production and the nation’s lack of full liability coverage to “double trouble”.

He explained, “You are not complying with the required full liability coverage; thus putting the nation in double jeopardy of increasing the risk of an accident by recklessly exceeding the safe operating limit, and also not having full liability coverage to cleanup a spill.”

Even more insulting however, according to the specialist is the fact that the ExxonMobil Guyana President, Alistair Routledge has made it clear that the company intends to challenge the payment of costs associated with a spill, unless it finds those costs to be “legitimate” and “reasonable”.

ExxonMobil has assured that for each event in the Stabroek Block, a US$600 million insurance policy is in place. In the meantime, it was reported that the oil company is in talks with the EPA to provide a US$2 billion parent company guarantee to cover costs above the insurance.

This means that the total coverage would amount to US$2.6 billion. Dr. Adams has however cautioned that this meager sum could very well prove insufficient to respond to a massive spill in Guyana as oil spill incidents in the past have cost more US$70 billion.

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• Guyana, oil, press, spill, Stabroek Block

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