Govt. must decide what protection Guyana must have from an oil spill not the Court – AG

Apr 09, 2024 Court Stories, ExxonMobil, Features / Columnists, News, Oil & Gas

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…says have no obligation to tell why he appealed ruling

Kaieteur News – The Government of Guyana (GoG) must determine the level of protection the country should receive to cover an oil spill and not the Court, Attorney General (AG) and Legal Affairs Minister, Anil Nandlall SC has said.

During an interview with the state media on Sunday evening, the AG sought to explain the government’s decision to approach the Caribbean Court of Justice (CCJ) to join a court matter where two citizens are challenging ExxonMobil to provide an unlimited parent company guarantee to cover all costs associated with a potential spill.

High Court Judge, Justice Sandil Kissoon on May 3, 2023 ordered the Environmental Protection Agency, (EPA) to issue an Enforcement Notice to Exxon Mobil to ensure it provides an unlimited oil spill coverage to safeguard Guyana, but the ruling was subsequently appealed by both Exxon and the EPA. The government was not allowed to join the matter. Nandlall is however arguing that the Court should not determine the level of protection the country receives, as the assurance should be the satisfaction of the government. He said the Environmental Protection Act which requires the oil spill insurance says “it must be to the satisfaction of the state.” He therefore made it clear, “This assurance is not to satisfy the judiciary, it is to satisfy the state. Who is in charge of management of the state? The government, so the government has to determine what that insurance or assurance will be.”

The AG was keen to note that while the EPA is tasked with securing that assurance, “it must be to the standard of the government.” According to his interpretation, this assurance cannot be ‘unlimited’. “You will never get an insurance coverage for a risk that has no limit,” Nandlall said. It must be noted that two citizens are fighting for a signed unlimited parent guarantee, which is a legal document that ties the company to cover all costs associated with a spill; it is not an “unlimited insurance” as referenced by the politician. The Legal Affairs Minister went on to note that the guarantee provided by Exxon does not mean that if an oil spill occurs in the future the company will not be required to pay beyond the US$2B guarantee that was lodged and the US$600M insurance. “That’s a total misconception,” he said.

No obligation

Nandlall also used the opportunity to clarify that he had no obligation to inform the nation of his recent decision to appeal the ruling, preventing the state from joining with ExxonMobil to fight against the unlimited oil spill parent guarantee. Guyana’s Court of Appeal in December last year unanimously rejected the application by the Attorney-General to join the case of two Guyanese, Frederick Collins and Godfrey Whyte, who are fighting for the Environmental Protection Agency (EPA) to get ExxonMobil Guyana to furnish the nation with an unlimited parent company guarantee (not insurance) for oil spills.

It was reported that the state secretly moved to the CCJ on February 29, 2024 to appeal the local ruling. When this newspaper sought confirmation with the AG on March 12 it was ignored. Subsequent queries with the Minister’s Office on March 28 and as recent as April 2, 2024 were unsuccessful, until a confirmation of the appeal on April 4, 2024. Despite making a direct request to the AG for the appeal he filed, Kaieteur News was not provided with the document.

Nandlall has made it clear that he does not have an obligation to inform the Kaieteur News, any other news outlet or any citizen of the government’s decision to appeal. He said, “They say that I filed the appeal secretly…I don’t know how it becomes a secret issue.” The AG pointed out that the proceedings were filed in accordance with the requirements of the CCJ.

Moreover, he reasoned, “I don’t know that I have a duty to give somebody in the press an appeal that I filed. Reporters know how to get legal documents; they have been doing it all the years. One newspaper owner feels offended that the Attorney General did not give him a copy of the proceedings. I don’t owe any such obligation to any reporter or to any news agency. The government doesn’t owe that obligation to anyone. There are ways by which you can get documents. These documents are public documents, go and get them! I owe you no obligation to send cases to you that I file and why am I going to send it to you anyhow?”

Gov’t must join the case

Meanwhile, in defending the decision of the government to be joined as a party to the fight against the full liability coverage for oil spills, Nandlall said the case has the potential to shut down Guyana’s oil and gas sector. “Now that case had the potential and has the potential to shut down the whole oil and gas sector because the contention in that case was there is a legal requirement for a guarantee or some form of financial assurance as is required under the Environmental Protection Agency Act and the operations are going on in the oil and gas sector without this assurance being in place,” he explained.

The AG continued, “As a result, one of the possibilities is that the license can be revoked, if the license is revoked, the operations will have to stop. Now these operations as you know is under a contract between the government of Guyana and the Licensees- Exxon and its affiliate companies. They are on one side of the agreement and the government is on the other side of the agreement, this is the infamous 2016 agreement signed under the APNU/AFC.”  He believes that since the country stands to lose “significant revenue flow” as result of a halt to the operations from the contract, the government should be joined as a party to the proceedings.

Nandlall said, “All these persons, they have no interest, direct interest in the oil and gas sector…every Tom, Dick and Harrylall (can) file cases although they have no direct interest in the oil and gas sector…now the government of Guyana draws a significant amount of money in terms of revenue inflow from the oil and gas sector under that agreement. We have said a million times that yes the agreement is lopsided but it is the agreement that we have to work with…if I am a party to a contract and I am to get significant revenue flow from this contract you would know and the entire world knows our budget for example has increased significantly because of the revenue flow from the oil and gas sector.”

He therefore reasoned that the government should have a hearing in the matter, since according to him the state has more interest than the current parties in the proceedings.

Nandlall said, “The myth is that we should be fighting for the unlimited guarantee. How can we fight for something that is impossible? We have a government to run. We have made promises to the people of this country, we have to behave responsibly. The people of this country expects their lives to be transformed or at least improved. They want the country to develop. We have that duty; that oil and gas sector is critical.” He said if a requirement is imposed which is a “financial impossibility” then the sector would shut down simply because the operator would not be able to meet a demand that does not exist.

To further qualify the government’s decision to appeal the ruling, the AG explained, “If the government doesn’t appeal this decision and allows a precedent to be left then cases can be filed and so many things can affect the government’s interest and the government will not become a party and adverse decisions can be made shutting down important projects and plans of the government, affecting thousands and tens of thousands of our citizens and the government is not going to be heard?” “The principle of appealing the decision is larger than this case. It’s about the right of a government to be heard in a case that affects the public interest and affects the government’s interest directly.”

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• AG, CCJ, guarantee, obligation, oil, spill

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