Page 11 - LatAmOil Week 11 2022

LatAmOil GUYANA LatAmOil

ExxonMobil and its partners are providing guarantees of funding for cleanup at Stabroek (Image: ExxonMobil)

Guyana’s EPA hopes to sign environmental

guarantee agreement on Stabroek soon

GUYANA’S Environmental Protection Agency after we pay for those expenses, we could then
(EPA) is reportedly on track to conclude an go to our insurance companies and file a claim
agreement on environmental guarantees with against our policy and they would reimburse us
affiliates of the shareholders in the Stabroek off- for these expenses.”
shore block before the end of March. The affiliate agreement serves as another
According to Kemraj Parsram, the executive safeguard against the unlikely possibility of
director of the EPA, the agreement is currently default, he added. “So, if EEPGL, Hess, CNOOC,
in the process of being made ready for signing. if we all default, [which is] very, very unlikely ...
“We are making good progress, and I am aiming then we’re also providing guarantees from other
to finalise possibly by month-end,” he told Oil- companies within our group that would be for
NOW.gy on March 16. the benefit of Guyana,” he said.
Parsram did not comment on the details of Both Rietema and Parsram were speaking
the document. He was speaking the day after after Vincent Adams, the former head of the
Phillip Rietema, the vice-president and business EPA, claimed that he had managed to strike a
service manager of Esso Exploration and Pro- deal with EEPGL on providing $2.5bn worth of
duction Guyana Ltd (EEPGL), a subsidiary of insurance coverage for Stabroek. Alistair Rou-
ExxonMobil (US), said his company expected to tledge, the president of ExxonMobil Guyana,
wrap up an agreement with the EPA on affiliate the ExxonMobil subsidiary that is developing
company guarantees in the near future. “It’s very the offshore block, said last week that his com-
close [to being finalised]. Very, very soon. Final pany and its partners had never made any such
details are being worked out,” he remarked.” agreement.
Speaking to reporters in Georgetown, Rie- Stabroek is Guyana’s first offshore block to
tema stressed that EEPGL and its partners in the begin production. Its Liza-1 oilfield came on
Stabroek project – namely, subsidiaries of the US stream in December 2019 and is now produc-
independent Hess and China National Offshore ing around 120,000 barrels per day of crude oil,
Oil Corp. (CNOOC) – had the financial and and the Liza-2 oilfield followed suit in February
technical resources to cope with even a major of this year. It will eventually yield 220,000 bpd.
accident at the block. They also have insurance ExxonMobil hopes to bring a third develop-
for their own investments in Stabroek, he said. ment project, Payara, on line in 2024, and will
The affiliate agreement then provides an extra then launch a fourth, Yellowtail, in 2025. Its fifth
guarantee by ensuring that Guyana can access project, Uaru, may then follow in 2026.
another $2bn in cleanup funds from companies Liza was the first oilfield found at Stabroek
affiliated with EEPGL, Hess and CNOOC, he and was brought on stream in late 2019, a little
explained. bit more than four years after its discovery. Since
“We’ve procured industry standard insur- 2015, ExxonMobil Guyana and its partners have
ance for the benefit of ExxonMobil Guyana found more than 20 commercial oilfields con-
and the co-venturers,” he stated. “So if we have taining at least 10bn barrels of oil equivalent
costs associated with an environmental incident (boe) in recoverable reserves at the block. ™

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