ExxonM promises to set up claims process to compensate for loss of livelihoods

Apr 02, 2025 News

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In event of an oil spill…

Kaieteur News-  ExxonMobil Guyana Limited (EMGL) has committed to establishing a claims process and livelihood remediation programme in the event of any large-scale oil spill which may occur at its seventh project, Hammerhead.

Hammerhead will produce approximately 150,000 to 180,000 barrels of oil per day (bpd) according to the Environmental Impact Assessment (EIA). The project is expected to commence by 2029, pending regulatory approval.

According to a study conducted by the company’s consultant, Environmental Resources Management (ERM), EMGL will establish a claims process and, depending on the magnitude of the oil spill, a livelihood remediation programme.

It was explained that the purpose of the claims process would be “to provide compensation as appropriate for asset losses” while the livelihood remediation programme would aim to “restore the welfare and livelihoods of affected persons to no less than pre-impact conditions.”

ExxonMobil noted that both processes would be transparent, fair, and conducted in a timely manner. The operator of the Stabroek Block also explained that the company, in consultation with the Government of Guyana and other jurisdictions- as required- would establish the designated geographic zones associated with the claims. Further, it explained that this system would also apply to the livelihood remediation processes, commensurate with the magnitude of the impacts of the spill.

“Eligible persons would be compensated as appropriate based on the magnitude of potential project-related impacts they individually experienced, either in regard to human health or as a result of economic loss,” the oil giant noted.

Importantly, the company said it would establish committees to determine who is eligible for compensation, their entitlement and what assistance should be offered to persons whose livelihood is affected.

“It is anticipated that EMGL would establish steering committees, working groups, and stakeholder engagement-specific entities to determine eligible stakeholders, standard entitlements, and eligibility criteria for further livelihood compensation and assistance,” the EIA states.

The company said it would “consider” establishing an independent implementation entity as soon as reasonably practicable after the spill, to assist in the process of livelihood remediation planning while the initial compensation efforts are ongoing.

Furthermore, the EIA explained that depending on the extent of losses, livelihood remediation efforts may potentially range from early support initiatives- within the first year- to transition support (typically from one to two years after impact), to longer-term support, as defined by the duration of potential spill impacts.

Oil spill risk

According to the EIA an oil spill that occurs at the seventh project has a 70 per cent  probability of hitting the shorelines of Region One.

According to the document, “The spill modeling evaluated a range of possible trajectories and rates of travel for an oil slick from each of the two above-referenced loss-of-well-control scenarios.” It noted that several factors could reduce the severity of an oil spill in the Project Development Area (PDA). These include the location of the spill, prevailing currents and climate.

The study said modeling predicted that surface oil would generally travel toward the northwest in all scenarios during both modeled seasons -June through November, and December through May. It stated, “For the Maximum WCD (Worst Case Discharge) scenario, the model predicted a 5- 10 per cent probability of oil contacting the Region One coast during the June to November season. The minimum time to reach the shoreline predicted by the model was five to 15 days.”

Meanwhile, regarding the December to May season, it was explained, “The model predicted probabilities of 5- 20 per cent and 5-70 per cent of oil reaching the coast of Region Two and Region One, respectively. The modeled minimum time for oil to reach the shoreline for this scenario is five to 15 days for Region Two and 1 to 10 days for Region One.”

A different model for the June to November season for the Most Credible WCD showed the probability of oil reaching the Region One shoreline is five to 10 per cent with the modeled minimum time of five to 15 days.

For the December to May season for the Most Credible WCD, the probability of oil reaching the shoreline ranges from five to 20 per cent for Region Two, and five to 70 per cent for Region One. The modeled minimum time for oil to reach the shoreline is five to 15 days for Region Two and one to 10 days for Region One. Exxon explained that the  five to 15-day travel time for oil would allow ample time for mobilisation of spill response resources to further reduce the risk of oil reaching the shoreline. However, if an oil spill were to hit Guyana’s shorelines, protected areas and coastal habitats could be impacted. These include the Shell Beach Protected Area in Region One, mangroves and even coastal communities where Indigenous tribes depend on fishing in the ocean, and other ecosystem services.

(ExxonM promises to set up claims process to compensate for loss of livelihoods)

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