Capping stack deployment time will reduce with equipment now in country – Jagdeo

Jul 16, 2024 News

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Kaieteur News – As the debate continues over the time outlined in the Environmental Permits for the deployment of the capping stack- the equipment that is used to plug oil leaks, but Vice President Bharrat Jagdeo has made it clear that a well blow out offshore Guyana can now be capped sooner with the equipment now in-country.

The VP was asked by this publication at his weekly press conference last Thursday at Freedom House to comment on a letter carried by this publication from Dr. Vincent Adams, the former head of the Environmental Protection Agency (EPA) questioning the government’s tripling of the required capping stack deployment time to cap a well blowout from 3 to 9 days, thus allowing a potential extra six days of oil gushing into the sea.

Adams during an Alliance For Change (AFC) press conference last week told the media that while 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.

Jagdeo said he doubted that Adams’ claim is accurate. “It was only the last permit that we… not the last one, the one before that…that we issued a requirement to have a capping stack in the country and one is here now… it came into the country so that you can deploy it immediately.”

He stressed that it is the immediacy of the deployment, if necessary, that is important and in the past Exxon just had to keep a subscription abroad. “Now we have one in the country. He is ignoring all of that. We have a capping stack in the country. The last time I told you that I had report that it arrived in the country ahead of time and that was a requirement of one of the environmental permits that we gave.”

Furthermore, now that the capping stack is already here, the VP is saying that there will be no wait time for it to be imported then deployed. “He (Adams) is squibbling about nine days, three days, two days. You have it now to deploy immediately rather than waiting for it to be imported.”

ExxonMobil Guyana Limited (EMGL) last week commissioned the country’s first capping stack, one of 13 available globally and one of only two in Latin America. A capping stack is a heavy piece of metal equipment that is placed over a blown out well. It acts as a plug, thereby preventing further flow of hydrocarbons.

Country Manager, Alistair Routledge during a simple ceremony hosted at the Guyana Shore Base Inc. (GYSBI), Houston, East Bank Demerara noted that the arrival of the equipment underscores the scale of Guyana’s blossoming oil and gas sector. Guyana began producing oil in December 2019 at the Liza One Project. The Liza Two development later came on stream in February 2022, followed by the Payara project in November 2023. The country is now producing over 640,000 barrels of oil per day (bopd) at three projects in the Stabroek Block.

The cost of the capping stack was not revealed, despite questions being posed to EMGL’s President. He explained, “I don’t have that number at hand but it’s a subscription service so what happens is (Oil Spill Response Limited) ORSL operates this, they maintain it, they keep it ready for deployment and then we pay a subscription fee, based on the wells we are drilling.”

The capping stack was designed and built by Trendsetter Engineering- a company that has been involved in the design and development of most of the capping stacks available. It is owned by Oil Spill Response Limited (OSRL), an industry-funded, not-for-profit cooperative that responds to oil spills. As part of its subscription service with OSRL, EMGL will be able to access the capping stack in record time from the GYSBI location. The company will also have access to OSRL’s fleet of capping stacks across the globe. The capping stack, now in country, measures 22 feet, three inches (height) and weighs 93,000 pounds (42 metric tonnes). The Air Freightable Capping Stack (AFCS) has a pressure rating of 15,000 pounds per square inch; a flow rate of zero to 330,000 barrels of oil per day (bopd) and depth rating of 12,500 feet (3,800 meters).

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• blow-out, Capping stack, deployment, Jagdeo, oil

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