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Capping stack to plug leaking oil well can take up to nine days to reach site
Kaieteur News – On November 9 2022, the Environmental Protection Agency (EPA) issued its fourth Permit to Esso Exploration and Production Guyana Limited (EEPGL) – ExxonMobil Guyana- to conduct production activities at the Yellowtail development.
The Permit, for the first time, required that a capping stack be procured and stored in country to be used in the event of a spill.
A capping stack is used to cap a blown-out well. It is a heavy piece of equipment that was engineered subsequent to one of the world’s most devastating spills in the Gulf of Mexico; where a blown out well continued releasing oil into the ocean for 87 days. This tool is used to stop or redirect the flow of hydrocarbons, allowing engineers to permanently seal the well.
According to the Yellowtail Permit, Exxon will have up to nine days to ensure that the capping stack reaches the location, in such an unfortunate event. The Yellowtail project is expected to produce as much as 250,000 barrels of oil per day.
The Permit at Section 9.14 explains “The Permit Holder shall maintain access to at least one (1) subscription service, in a location outside of Guyana, to allow mobilization of a capping stack to the Yellowtail Project location within nine (9) calendar days or less of an uncontrolled well event.”
A Capping Stack is placed over a blown-out well to limit the damages of an oil spill
Similarly, the new Permit granted by the regulator for the oil giant’s fifth project- Uaru- also makes provision for the capping stack to be on site within nine days. This can be found at Section 9.13 of the document, which was signed on April 27, 2023.
Exxon’s Uaru project is designed to produce 250,000 barrels per day on an annual average, according to Environmental Impact Assessment (EIA). It can however produce up to 263,000 barrels of oil a day.
The Payara Permit- for Exxon’s third project- however required that the Capping Stack be deployed within three to four days – less than half the time now required at the other projects.
The document, signed on September 24, 2020 states at Section 8.10 “Within thirty (30) days of the date of the Permit, the Permit Holder shall submit to the EPA for approval, terms of reference for a study detailing the implementation of a system that allows for deployment of a Capping Stack and Debris Removal Systems within three (3) days and four (4) days of an uncontrolled well event, including the cost and benefits of each such system.”
Former Head of the EPA, Dr. Vincent Adams during an Alliance For Change (AFC) press conference last week told the media that while Vice President Bharrat Jagdeo claims to have tightened environmental provisions in the Permits granted to the oil company, its position on the Capping Stack arrival to a blown-out well proves different.
“The Vice President keeps going around saying that they tightened the environmental regulations…that capping stack was created by Dr. Bynoe under the Department of Energy and we supported him. We demanded that that capping stack has to get to the site within three days- that’s what’s in the Payara. Do you know what they did? They took that out of the Payara and put nine days into Yellowtail which is the Permit that they wrote,” he argued.
It must be noted that the while there is likely to be extreme damage from such an event offshore, there is still no evidence of full liability coverage from the parent company. This means Guyana can be left to foot the costs of cleanup, repairs and compensation if these costs are not covered by the limited US$600 million insurance.
Besides the insurance, EEPGL has about US$9 billion in assets which the VP says could be seized to pay for the damages. Dr. Adams also believes that this is merely a band-aid to the wound as these assets are paid for through cost recovery by Guyana.
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