Latest update November 15th, 2024 1:00 AM
Exxon paid bill for independent consultant who provided US$2 billion parent company guarantee estimate for Guyana
Kaieteur News – Head of Esso Exploration and Production Guyana Limited (EEPGL), Alistair Routledge has confirmed that his company paid the bill for the independent consultant that was used to determine how much its parent company, ExxonMobil Corporation, should give Guyana to cover oil spill costs. That consultant determined that US$2B is sufficient enough to serve as a parent guarantee.
That sum complements a US$600M package that has been provided to Guyana by EEPGL.
ExxonMobil Guyana President, Alistair Routledge
During a press conference yesterday at its Kingston Office, Routledge said the estimate was provided by an independent expert that does this kind of work on a global basis while using standards that are applied in the Australian Oil and Gas Industry. He said, “We are also doing a follow up study which uses the UK standards and which is part of some of the highest standards in the world.”
Routledge added, “…We paid for the bill for the consultant but the work has been done and very transparently for the Environmental Protection Agency…”
Routledge also noted that the documents pertaining to the US$2B insurance guarantee are being finalized with the other partners on the block, namely Hess Corporation and CNOOC, and will soon be provided to the EPA.
He was also keen to note that the company’s position is that this is a sufficient sum for a parent guarantee that covers credible costs pertaining to an oil spill. Routledge said the company firmly disagrees with the demands of a recent court ruling for an unlimited parent guarantee agreement.
That ruling was handed down on May 3, 2023 by Justice Sandil Kissoon in relation to a case filed last September by two Guyanese. Justice Kissoon had disregarded copies of unsigned documents pertaining to the US$2B parent guarantee. He categorically stated in his ruling that the Liza Phase One Environmental Permit calls unequivocally for an unlimited parent guarantee agreement, adding that anything less leaves EEPGL and its partners in breach of the permit.
He has since given EEPGL as well as the EPA to comply with the provisions of the permit by June 10 or see its suspension. Both parties have since appealed the case, the judgment for which is expected in May 29.
Internationally, the ruling has had a significant impact on Exxon’s stock price. It plunged by 12 percent in recent weeks to US$105.
ExxonMobil shareholders have also taken note of the ruling and are poised to challenge the oil giant to come clean about the potential risks and liabilities of its operations which could affect not only Guyana but 12 other Caribbean nations. That challenge is expected to manifest by way of two proposals come May 31 at Exxon’s Annual Shareholders Meeting.
- Alistair Routledge, Corporation, Esso Exploration and Production Guyana Limited (EEPGL), ExxonMobil, Guyanese
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