Govt. looking out for Exxon instead of Guyana- TIGI President

May 06, 2023 News

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…as administration signals move to appeal Court ruling on full liability coverage

“I can tell you that the conclusion that a lot of people are coming to is that the government is more concerned about Exxon’s business than ours, and it is a strange sight to behold because in no self-respecting business does a regulator even want to appear to be looking out for the interest of the companies he has to regulate, over the interest of the people on whose behalf he is regulating.”

“You can’t go the states or anywhere in the world and see a regulator actually taking the side of a corporation, and in this case, an entire government.”

By Davina Bagot

Kaieteur News – The announcement by the Government of Guyana (GoG) to challenge a court ruling that seeks to ensure the nation is prevented from having to stand the expenses associated with an oil spill, has been baffling to Guyanese across the miles.

In fact, the statement that such a parent company guarantee can have “grave economic impacts” on the public interest, has been discounted by President of the Transparency Institute of Guyana Inc (TIGI), Mr. Frederick Collins, who believes that this confirms the administration is more interested in protecting Exxon than Guyana.

Collins and another citizen, Godfrey Whyte had taken the Environmental Protection Agency (EPA) to Court through their Attorneys, Seenath Jairam, SC, Melinda Janki, and Abiola Wong-Inniss on September 13, 2022 over oil spill insurance for the Stabroek Block oil activities.

High Court Judge, Justice Sandil Kissoon on May 3, 2023 ordered the EPA to issue an Enforcement Notice to Esso Exploration and Production Guyana Limited (EEPGL) and its parent company, ExxonMobil to ensure it provides unlimited insurance coverage to safeguard Guyana against the devastating effects of an oil spill within the next thirty days.

Moments after the ruling, the Attorney General, Anil Nandlall, S.C in a statement indicated, “The EPA and the Government of Guyana are of the considered view that the Environmental Permit imposes no obligation on the Permit Holder to provide an unlimited Parent Company Guarantee Agreement and/or Affiliate Company Guarantee Agreement. In this regard, we hold the respectful opinion that the Learned Judge fell into error in his findings. This ruling can have profound ramifications and grave economic and other impacts on the public interest and national development.”

Weighing in on this response, Collins in an exclusive interview with this newspaper on Friday said it is strange that the administration has only now recognized that such a guarantee is bad for business. He explained that the High Court Judge handed down his ruling in keeping with the laws of the country and the Environmental Permits issued to the developer.

“We have to ask when did they realize it was bad for business because that is the law, those are the laws that are set out. Those were the constitutional clauses that the government relied upon. These are the clauses which were passed in Parliament and were passed to govern the environment and our rights as Guyanese people to enjoy a clean environment,” Collins said.

He added that the Permits were granted in accordance with those laws, which took investment of time and Parliamentary debates before it became law. As such, he reasoned, “Government should tell us how long they knew that it was bad for business. Was it only when Exxon came along, and if so, did they not realize, the EPA itself, when it put that into the Permit, because that is what the Judge used. So they make no sense.”

Bad for whose business?

The transparency advocate explained that citizens are now concluding that the administration is more concerned about Exxon’s interest than the Guyanese.

“I can tell you that the conclusion that a lot of people are coming to is that the government is more concerned about Exxon’s business than ours and it is a strange sight to behold because in no self-respecting business does a regulator even want to appear to be looking out for the interest of the companies he has to regulate over the interest of the people on whose behalf he is regulating. Let alone, not just appear but even to voice such sentiments so nobody quite understands what is happening. Nobody can quite figure it out. In fact, there are people who have nicknamed the EPA the Exxon Protection Agency, because we can’t figure it out. It makes no sense,” he argued.

He said while it is known that the EPA is being controlled by the government, this has been the history of politics in the country, especially under the present regime.

Collins said, “They are not happy until they can control every single institution in the country. Now the problem with that is that they can’t control the Court because it’s the same Court they have to go and run to when there was the attempt to hijack the election results.”

Telling the regulator how to do its job

Vice President, Bharrat Jagdeo at his most recent party press conference shared that the judiciary is treading in murky waters by directing a regulatory agency on how to do its job and setting a timeframe on when it should complete certain orders.

Collins however reasoned, “Is the EPA really doing its job? Mr. Jagdeo should listen to himself. What is clear is not just that the Court is getting involved in telling a regulator how to do its job, it is in fact sad that the Court has to tell the regulator that it is not doing its job.”

He said that having listened to the Court ruling, there were parts of the verbal ruling that was not included in the written ruling which highlights how “ridiculous” the actions of the EPA were. “You can’t go the states or anywhere in the world and see a regulator actually taking the side of a corporation, and in this case, an entire government,” the TIGI President stressed.

Interpretation of parent guarantee

While government has stated its intent to appeal the Court ruling since it believes there is no existing policy such as ‘full insurance coverage’, Collins said the administration is wholly misinformed or plainly acting naive on what this means.

He pointed out, “A guarantee is saying if he doesn’t pay, I will. Mr. Jagdeo is apparently concerned about the ability of the market to provide that insurance.” Collins noted that when the oil spill occurred in Gulf of Mexico back in 2010, the operator at the time, British Petroleum (BP) did not have an insurance policy to cover the damages which were in excess of US$60 billion. He explained that the additional costs were bourne by the operator as the insurance policy did not bother the American government, since the laws in place were sufficient to prevent the company from even considering to duck from its responsibility.

To this end, he said, “Regardless of who it was, whether the person had insurance or not, BP had to pay because the polluter pays and if there is to be a catastrophe in Guyana, whether there is an insurance to the tune of whatever it is, we need the guarantee because there is no law or power that is going to make the Guyanese government get Exxon or anybody to fork out that amount of money and that is why we need the guarantee because we need the insurance, which wasn’t enough in the BP case, because if it is not them, guess who is going to have to do it? It is the Guyanese people who would have to face the consequences of a cleanup.”

Collins said if Jagdeo believes this is too much to ask the oil companies for, he is essentially insisting that this cost must be bourne by the Guyanese people.

Dodging responsibility?

The TIGI president said the US oil major is so clever that it constituted an affiliate- Esso Exploration and Production Guyana Limited- EEPGL to operate the Stabroek Block which is a limited liability company- in this case which merely has assets no more than US$8 billion.

Collins was keen to note, “They have deliberately done that in order to constrain any amount of damage done and clean up to a certain limit. So what they are saying is that we don’t want our great money to be exposed, so we can do whatever we like and dirty the place…that is what these people do so that they can shield their profits and leave their expenses to the Guyanese people and what the government is doing is supporting that nonsense.”

The TIGI President concluded, “Things are simpler than they are being made to appear. Firstly, what ought to be required of them (Exxon) and has been required of them according to the Permit that was given, like the Judge pointed out, is no more than they are accustomed to in any other responsible part of the world; and so why they don’t want to adhere to it is anybody’s guess and why they are being accommodated to that is anybody’s guess.”

 

 

 

 

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• court, ExxonMobil, guarantee, looking out, oil spill

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