Neighbours affected by an oil spill can sue ExxonMobil for damages, says VP Jagdeo

Jun 08, 2025 News

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Kaieteur News – In the event of an oil spill offshore Guyana, nearby affected countries will have to sue ExxonMobil to obtain a remedy for damages, Vice President Bharrat Jagdeo told reporters on Thursday.

It was reported that as many as 14 island countries could be affected by an oil spill in Guyana.

Jagdeo, at his weekly press conference held at Freedom House on Robb Street, was asked by Kaieteur News whether the Oil Spill Law guarantees Guyana and its regional neighbours full and adequate compensation in the event of an oil spill that causes environmental or economic damages.

The Vice President said that with the new law in place, the new permits being granted by the Environmental Protection Agency (EPA) would have to ensure that Exxon and its partners are responsible and that the financial assurances they provide are consistent.

“They’re responsible for all of the damages caused, that is, the cleanup cost of the damage caused from a potential oil spill and two for consequential losses,” he said.

Asked whether the new law makes provision for Guyana’s neighbours to be covered under the financial assurances, Jagdeo said, “We legislate for the state of Guyana. They have to provide financial assurances consistent with the new law or their liabilities under the new law. So, the assurances they give must cover all of those liabilities, that’s what we want.”

He continued: “So, I suspect if you’re talking about like Trinidad and Tobago. I don’t think they’ll legislate for Guyana when they look at oil spills etc., they can sue the company too… they can sue the company (to be compensated).”

There has been a lot of controversy surrounding the law even before President Ali assented to it. A number of experts and international organisations have pleaded with him not to sign off on the bill, citing it being contrary to international obligations, good governance and a violation of the rule of law.

On May 20, this publication reported that international lawyer Melinda Janki wrote to President Ali, asking him not to sign off on the bill, due to it being contrary to international obligations.

Contrary to int’l obligations

In her letter to President Ali, Janki said: “The Bill was passed in the National Assembly on Friday, 16 May. It will be sent to you for your assent as President to enable it to become law under Article 170 of the Constitution. You must withhold your assent because the Bill is contrary to Guyana’s international legal obligations and is unconstitutional.”  The lawyer pointed out that the drafter of the Bill clearly had no idea about Guyana’s international law obligations. “The Bill at best contains meaningless references to international law and does not meet the requirements of international law for Guyana to act with due diligence and to take steps to prevent transboundary harm.”

She noted that Article 149J of the Constitution requires the State to take “reasonable legislative measures” to protect the environment, including preventing pollution and ecological degradation. However, Janki said the bill attempts to: (i) lower or remove altogether (through the doctrine of implied repeal) the environmental protection and environmental rules and standards set out in the Environmental Protection Act or made under the authority of that act; (ii) to remove or make redundant the system of environmental management to protect the environment.

Additionally, she said the Bill lacks the precautionary principle, which was described by Justice Winston Anderson, the future President of the Caribbean Court of Justice, as follows: “Precaution is emerging as a bedrock principle in Caribbean law relating to resource exploitation. The clearest statement of the principle is to be found in the 1996 Environmental Protection Act of Guyana.”

Janki said that the bill gives the executive the power to forego obtaining financial assurance, such as the unlimited, uncapped parent company guarantee, which ExxonMobil Guyana Ltd. is currently required by law to provide in order to protect Guyana from financial liability as a result of Exxon’s petroleum operations. “The Environmental Protection Act is the baseline. Under Article 149J, the State may improve environmental protection, but the State cannot reduce environmental protection. The Bill is therefore not a reasonable legislative measure, violates Article 149J and is offensive to the Constitution,” Janki told President Ali.

Protecting foreign companies  

She also said that the Bill seeks to protect foreign oil companies at the expense of Guyana. “The BP Macondo well blowout in 2010 cost BP over US$65 billion, or around US$95billion in today’s money. Guyana’s revenue from oil for the whole of 2024 is reported as being US$2.57billion. It would take Guyana more than 35 years of current income to pay for a Macondo-type spill if the ‘responsible party’ did not pay and if there was no effective and readily enforceable unlimited uncapped parent company guarantee as is currently required by law,” Janki warned.

She reminded President Ali that Justice Sandil Kissoon had warned in 2023 in the Collins and Whyte v EPA, ExxonMobil and Attorney-General case that if there is an oil spill, “…the consequences will be devastating not only to the citizens of this land and the environment but to inhabitants of neighbouring states and territories as well.” He further warned that in the absence of the unlimited uncapped parent company, “then the potential consequences are elevated and border on catastrophic.” “This massive potential liability as a result of harm to neighbouring sovereign states and their economies is well illustrated in ExxonMobil’s maps, Janki said, noting that, as is common and public knowledge, deep water drilling is a very dangerous exercise.

According to the lawyer, ExxonMobil has admitted to using faulty equipment (the gas processor) and to operating above the limits set in its environmental impact assessments, thereby increasing the danger to Guyana financially and environmentally. “All MPs who voted for this Bill should now be required to provide ‘financial assurance’ to cover the increased financial risk to Guyana as a result of their reckless approval of this Bill. Should you decide to assent to this Bill, the people of Guyana will be entitled to demand that you also provide ‘financial assurance’ to them,” Janki told the President.

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