Govt. exploring lessons from oil spills worldwide to shape new legislation – VP Jagdeo

Mar 23, 2024 ExxonMobil, News, Oil & Gas

---

Kaieteur News – With Guyana’s oil spill legislation currently being drafted, Vice President (VP), Bharrat Jagdeo on Thursday disclosed that for the past several months the Government of Guyana (GoG) has been examining how countries deal with issues in relation to oil spills.

Jagdeo, during his weekly press conference, highlighted the examination of global practices in handling oil spill incidents to inform the impending legislation. One such oil spill the Vice President mentioned is lessons learned by the United States following the 1989 Exxon Valdez oil spill.

According to reports, on March 24, 1989, an oil tanker owned by ExxonMobil Corporation and dubbed the “Exxon Valdez” ran aground in a body of water in the Gulf of Alaska. It was heading to Long Beach, California with over 50 million barrels of oil but had hit a well-known navigation hazard in Alaska’s waters. The impact of the collision tore open the ship’s hull, causing some 11 million gallons of crude oil to spill into the ecologically sensitive location. At the time, it was the largest single oil spill in U.S. waters. Initial attempts to contain the oil failed, and in the months that followed, the oil slick spread, eventually blackening about 1,300 miles of Alaska’s coastline. It was, and still is, regarded as one of the largest environmental disasters in U.S. history.

On Thursday, Jagdeo outlined the key components of the proposed legislation, including delineating responsibilities, liabilities, and compensation mechanisms in the event of an oil spill.

“So we have been working at this for a while now, looking at how we strengthen legislatively, so we can have clear legislation on how to tackle these things, there is no ambiguity, just in case these things happen,” the Vice President said.

He underscored the importance of clarity and fairness, stressing the need for independent mechanism to resolve disputes regarding compensation for spills. He noted, “Often oil companies argue if the government comes up with a figure for compensation…they will argue (for) a different figure. So an independent fair mechanism for all of those things.”

Jagdeo further explained that the Government’s aim is to strengthen the law governing any situation in the event of an oil spill.

“We will determine responsibilities both from the states side and from the parties causing the spill, we will determine liabilities in the act who will be liable for what, we would have to have a mechanism that allows us to immediately tackle the consequences of the spill but also a mechanism that could lead to resolution to things like compensation etcetera,” Jagdeo told reporters.

The Vice President also addressed the complexities surrounding liability in cases involving vessels hired by oil companies, highlighting the gaps in existing regulations. He said the new law will cater for spills that occur during the transport of petroleum products.

Jagdeo said, “So if a vessel were to have a blowout, of one of these big vessels transporting oil and gas…they may not be associated with Exxon, this is a company that they hire so who is liable in that instance and how to we enforce the liability all of these are questions that we would look at in the legislation.”

The Vice President also noted that there are lots of things that the Government is working on in relation to regulations for the petroleum sector. He reiterated that the oil spill legislation will be laid in the National Assembly before it heads to recess.

Speaking on the Petroleum Commission, Jagdeo said the government is still to decide on the implementation of the independent body. Outside of that, he said the Government has fulfilled its policy agenda for the oil and gas sector, with new things to come on stream.

ExxonMobil Guyana announced the discovery of oil in 2015 and swiftly moved to commence production activities by December 2019. Exxon is the operator of the Stabroek Block with a 45% interest, while Hess Guyana Exploration Ltd. holds 30% interest and CNOOC Petroleum Guyana Limited holds 25% interest.

Production from the Stabroek Block developments sits above 600,000 barrels per day (bdp) – with Exxon having the Liza 1, Liza 2 and the Payara projects online. The oil companies have embarked on an aggressive drilling campaign in the Stabroek Block targeting three other developments: Yellowtail, Uaru and Whiptail projects. It should be noted that Yellowtail and Uaru have already been approved, while Whiptail is under review awaiting government approval any day now.

---

• Bharrat Jagdeo, Exxon, oil, spill, Valdez

---