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In a spirited defence of the A Partnership of National Unity and Alliance for Change (APNU+AFC) government’s management of the budding oil and gas sector, Member of Parliament (MP) Ricky Ramsaroop lambasted the People’s Progressive Party Civic (PPP/C) Government for removing the “guard rails” and putting the lives of Guyanese at risk.
Making his case during the recent 2023 Budget Debate in the National Assembly, Ramsaroop said, “When the coalition government took over after 23 years of destructions to the EPA [Environmental Protection Agency], it was dysfunctional, it had only two vehicles for inspection and monitoring, which meant that no field monitoring nor inspections occurred; no filing system of records to even know how many permits and operations existed.”
The MP the coalition found the agency did not even have records of numerous operations and there were over 600 expired permits, some over 15 years. However, “within less than three years, the Agency he said, discovered that “over 2,000 projects existed; brought all permits and operations into compliance; had eight brand new vehicles without a dime from the treasury, but funded by the collection of over $150 Million dollars in fees owed from expired permits and back fees; built a state of art registry and filing system to manage these projects;
“… increased staff by 20% with engineers and scientists which the agency was severely lacking; tripled the number of EPA offices from one to three by adding offices on the Corentyne and Linden to ease the financial burden and inconvenience of businesspeople having to travel to Georgetown only, to conduct business; established a 24/7 complaints hotline with a 24 hour response time; and developed a culture of transparency and free access to the media and public.”
He noted, “ instead of them building upon the strong foundation which we handed to them, they have now reverted back to the old destructive ways of the PPP. Staff are now being directed to issue permits without inspection.
“Mr. Speaker, most disturbingly, we have learnt that EXXON files have been moved directly to the executive director’s office. The question is: What is so special about this company and why it had to move there, what is there to hide? And why is this company being treated differently to even our local businesses?
Disregard for Capacity building for EPA
Ramsaroop told the House when the coalition entered government the EPA had no one with any Petroleum background in the oil and gas sector when we took over. In order to quickly build capacity to perform adequate monitoring and oversight of the oil and gas operations, with US$1 million from the World Bank, the Bank and Government developed a plan to build a 36-member Oil & Gas Unit of highly specialised skills and experience for 24/7 on-site presence on the drill ships and FPSO’s to obtain credible and real time information, he stated.
However, when the PPP took office, “they abandon that plan and denied that it ever existed until the Plan surfaced in the newspapers and caught them with their pants down, forcing the Minister to defer questions to the EPA Director, whose excuse was that he didn’t know the plan existed, since he wasn’t there.”
He added, “to suggest that they didn’t know that such an important and critical …Plan existed, confirms their incompetency and incapability to manage this important sector and their continued wasting of the World Bank’s money. Even though they have been caught red-handed about one year ago, they still have not done anything to implement the plan to ensure 24/7 on site presence.”
Additionally, he debated, the coalition established a study leave program to build capacity, where the EPA was to sponsor students to go to university and trained and signed a four-year contract to serve afterwards but all these were abandoned.
He stated the PPP told thE students who had already applied to universities and preparing to go, that the programme was abandoned, and they are on their own.
“Mr. Speaker, every major project or business development must go through this institution. And it is shocking to learn that they don’t have money to pay its staff for this month. This institution is very important to the newly discovered oil resources. With the upscale production in the Stabroek block and many others to come Guyana must guard against environmental hazards such as oil spills, flaring and the dumping of toxic wastewater into the ocean. These are three major issues that Guyanese should be concerned with, and the EPA should equip itself to manage these.”
He stated, “The Lisa phase I in 2021 flared over one billion cubic feet of gas because of a faulty compressor which they said was fixed but flaring continues with no direct penalty. We must understand that flaring releases over 250 identified toxins including carcinogens such as benzopyrene, benzene, carbon disulfide (CS2), carbonyl sulfide (COS) and toluene; metals such as mercury, arsenic, and chromium; sour gas with Hydrogen Sulfide (H2S) and Sulfur to name a few.
“We learned that US$10 million were paid to EPA. Sir, this is a green light to flare. What we now have is a government aka ‘PAY TO POLLUTE’ or ‘A NO EIA GOVERNMENT’ Demerara Harbour Bridge – no EIA required! The EPA published the notice in late 2020 that the bridge would require an EIA, only to have it overturned by the politicians in early 2021 against the EPA decision for an EIA to be done.
“As soon as the coalition government was out of power a close associate of the government cleared a huge plantation of mangrove forest at Vreed-En-Hoop again with no EIA and not even an application or EPA authorisation to cut down the mangroves.”
Ramsaroop told the House he recalls senior government officials making statements that polluting Guyana is the cost of development of Guyana, which he argued is not callous and irresponsible but shows the government values money over people’s health, safety, and the environment.
He proceeded to outline: –
“the dumping of produce water is strictly prohibited in all parts of the world and prescribed by the World Bank. This has to do with highly toxic heavy metals, radioactive material, and hot water three times more than ocean water. This produced water also contains oil inside and if we continue to dump this produced water with the rapid pace of oil production development then we will be dumping hundreds of thousands of barrels of pure oil into the ocean.
“the World Bank report said that dumping of this produced water is prohibited unless it is not financially or technically feasible, but in this case, it is easily feasible both financially and technically since normal international best practice calls for it to be reinjected back into the reservoir with standard technologies to maintain the reservoir pressure, but in Guyana, they are injecting clean water from the ocean while dumping the toxic produced water in the ocean. How could that make any godly sense Mr speaker except if it’s only for greed and putting money above people’s health and the environment?”
Highly controversial Consultant
Ramsaroop told the House the PPP Government brought a highly controversial consultant from Canada, Ms. Alison Redford to expedite the issuing of the permit for the Payara project.
“The team which was led by Ms. Redford, and comprised of the EPA, GGMC, and DOE, unanimously arrived at the decision that there shall be no dumping of produced water nor flaring of gas. The team met with Exxon and so directed that they install the equipment to do so. However, the PPPC government discarded that decision and now allows the unlimited dumping of the produced toxic water and unlimited flaring of the toxic gases as long as they could pay for it. That’s right! Pollute as much as you want as long as you can pay for it. The pay to pollute government,” he posited.
Reminding the Assembly, the media and public called for the release of the report, but it was ignored, he said “We now ask again, where is the Allison Redford report and why are they hiding it Mr. Speaker. The only conclusion could be that they do not want the public to know that they went against their own foreign consultant and government agencies to the health and environmental detriment of our people and nation they are supposed to be protecting? Show us the Allison Redford report!”
Turning attention to the importance of avoiding any mishap, Ramsaroop argued that with the rapid rate of development in the Oil and Gas sector a country must be prepared for any mishap that we see in other parts of the world. “All the monies earned now can be gone in a split of a second, we can further plunge the country into bankruptcy, more heavy debts that current and future generations will pay a hefty price for that is poverty, ” he noted.
“Worldwide offshore oil production operations like Guyana shows a high likelihood of an oil spill occurring offshore and that such likelihood of a spill increases exponentially with the rapid increase in offshore production activities and the reckless conduct of Exxon with approval from the government to produce at a rate of 25% above the safe operating limit defined in the EIA putting the country at high risk for a spill. And Sir if we look at the emergency response and clean-up of the British Petroleum Macondo oil spill in the Gulf of Mexico have so far cost US$145 billion.”
“The government is now talking about being able to see oil spills remotely, when more importantly, we should have 24/7 onboard oversight to prevent the spill. It’s useless and too late when you see the spill Mr. Speaker. We call on the government to Implement the World Bank’s 36-member program of high personnel to provide this capacity to prevent a spill in the first place by its on-site rigorous oversight!,” he mentioned.
Further, he highlighted, “this topic seems to be a secret from the Guyanese people at large, if by chance any of the disasters that I previously mentioned Guyana and the rest of the Caribbean are doomed. It will forever remain as it is. The coalition demanded and got Exxon to agree to have full liability coverage to cover any size spills. Full liability coverage consists of insurance plus a parent company guarantee that covers all costs above the insurance. A simple formula sir!”
Full coverage = insurance + parent company guarantee
“Mr. Speaker, that is what is enshrined in the permits and what is being negligently allowed to be violated by this Government, but like everything else Mr. Speaker, it is the modus operandi of the government to Not Follow the Rule Of Law like other civilized and democratic countries would do. Sadly, We now live in an autocracy, Mr. Speaker.
“Mr Speaker, in last year’s debate, we heard some Ministers saying that a parent company guarantee would be too costly. So, Mr. Speaker, please give me the honour of educating my honourable colleagues on the other side that A Parent Company Guarantee Costs Nothing. Nada! Nothing! It’s Only A Piece Of Paper From Exxon the parent company and its partners Hess and CNOOC guaranteeing that they will cover all costs over and above the paltry insurance of $600 million.
“This language for full liability coverage, which was created by the coalition, was put into the Liza 2 permit by the coalition and now copied by the PPPC Government into all of the other permits by the PPPC. The VP himself verified this on the Glen Lall show and read the section with the language. However, the government is allowing Exxon to operate without This Parent Company Guarantee And With Only $600 Million In Insurance. Where Is The Parent Company Guarantee That Costs Nothing Mr. Speaker!”
Zeroing on experiences elsewhere, MP noted “the Macondo spill cost $145 USD billion, so, if you have a Macondo type spill, who will cover the US$144.4 Billion above the $600 Million insurance which is a mere 0.4% of the cost of the Macondo spill. To put it another way…the Macondo spill cost close to 250 times the $600 million insurance and close to 50 times our entire national budget…
“Therefore Mr. Speaker, is there a mystery still to anyone in this assembly as to why Guyana and many of its neighbours would be financially bankrupt with the destruction of our fishing industry, tourism, and ecology. Mr. Speaker I am not making this up, it is all in the EIAs. It will wipe out the Caribbean, tourism, and many others.
“Further…, even though the guarantee is of zero cost, the government is now appeasing EEPGL by talking about cutting the legally required full/unlimited guarantee to $2 Billion. Again, who will cover the US$143 Billion or so, above that insurance amount with a parent company guarantee of only $2Billion?”
Turning to the government side of the House the MP asked why won’t Exxon want to sign a legally required guarantee that costs nothing, especially since they pledge that they will never walk away from any such responsibility?
Getting away with lawlessness and callousness
Answering the question Ramsaroop stated “the fact that it is because they are being allowed to get away with this lawlessness and callousness by our reckless government that doesn’t respect our own laws. But the real reason, Mr. Speaker, is that Exxon would have no liability above the $600 Million insurance and would walk away if it gets too costly. Think about it.. how else could it be explained for if they pledge they won’t walk away, why can’t they put that pledge in writing if it costs nothing?”
Are we not learning from our neighbour, Peru, which had a small spill recently and where the oil company Repsol, a company operating in Guyana, was uncooperative and the government had to seize their Executives passports and sue the company for several billions of dollars, he queried
Is this the road we want to go down Mr. speaker? The Peru Government has learnt a hard lesson and is now putting regulations in place to correct that lesson. As the old people seh Mr. Speaker, you can’t wait till night to see with candle light what you could see in daylight.
Does the Govt understand that EEPGL is a limited liability company of Exxon and does not have assets to cover a spill. It’s troubling to hear the government erroneously talking about seizing the $5 billion or so in assets owned by EEPGL. Doesn’t the government know that most of EEPGL’s assets such as the FPSOs etc., belong to the govt of Guyana and we are paying for those and they will be handed over to us at the end of the project?,” he mentioned.
“Again Mr. Speaker we have an issue with this project, how can you have an EIA done for such a high-risk project without having a Gas Leak Management Plan in place?
“Remember what an EIA is; that’s the document that defines it, it’s like a bible of any project. It defines all the environmental risks and hazards. No other document does it in detail, so if a risk has not been identified and not only identified, it has to say in that EIA how you will address that risk in terms of mitigative action or how you are going to respond if something happens.”
The MP stated if the EIA fails to address such an aspect it should be deemed incomplete. “ In the environmental study submitted by Exxon, through its Consultant, Environmental Resources Management (ERM), it was stated that gas leaks, and worse yet explosions are likely to occur because of corrosion, objects striking the pipeline, and a build-up of stress in the pipe wall, causing buckling. Even though this risk was identified, the Consultant did not see it fit to also attach a detailed response plan, accompanied by the various scenarios in which such an event can occur.”
Sole purpose of EIA is to identify risks and propose measures to address same
Mr. Speaker, he continued “the sole purpose of the EIA is to identify risks and propose measures to address same. That’s what an EIA does and if that risk, let’s say a leaking pipeline below the ocean is not addressed in the EIA, then that EIA is incomplete because no risk has been identified and how will you address it. The gas leak management plan must be inserted in the EIA. Anything that could potentially impact the environment, even if you are just thinking or it’s just a thought that it might occur, you’ve got to study it and say in the EIA.
“For argument, if it’s highly unlikely and this may never occur, but you have to address it and study it in the EIA. It’s a hazard Mr. speaker. A leaking gas line in the ocean is hazardous for many reasons. First of all it’s toxic to fish, especially certain fish…they have to say well okay how will you be monitoring that gas line to see when it’s leaking or not, and how it will be addressed. All of that must be analysed and the only document that does that is an EIA,” he said.
“Expectations for the Development Of The EPA
– Implement the World Bank Plan providing for a 36-member unit of highly specialised Oil & Gas unit at the EPA for robust oversight and monitoring including 24/7 on-ship presence to obtain reliable and real-time data.
– 24/7 on-board oversight to prevent the spill.
– Transparency and media access
– Desist from giving Exxon preferential treatment and stop hiding their files in the Directors’ office.
– Implement the study leave policy created by the coalition which invests in specialized staff training with 4 years of return in service,” he argued.
He mentioned, “Mr. Speaker, I want to touch on the carbon credits that the senior Finance minister mentioned in his budget speech, and I must give credit where it is due for finding a new revenue stream. Because access to the remaining monies from the Norwegian will pose some difficulties for this government especially if you don’t have a proper plan or project design that will impact the lives of the Guyanese people.
“…the Senior minister mentioned when they took over a government that Forestry was in a deplorable state, and I will challenge him to provide to this House the financial records including bank statements after they were kicked out of government for corruption. Let them bring the records. Because it is no secret that they squandered from the coffers of GFC by investing over $600 million for that High Street building that was deemed unsafe for human occupation.
“Another $400 million to the Marriott Hotel that to this day cannot bring in the revenue back to the Guyana Forestry Commission. Luckily Mr. Speaker, we managed to recover from the CLICO fiasco that was approximately $300 million and finally a $300 million loan to Iwokrama that was written off due to its role it plays in biodiversity conservation.
“The coalition government inherited a deplorable Guyana Forestry Commission from the PPP government in 2015. Today sir they are still crying foul, staff are being paid by alphabetical order, they don’t know if they will get a raise in this budget. The Staff of the Guyana Forestry commission worked hard to ensure that the assessment that was done by ART TREES which brought in over $US270 million from the purchase of carbon credits sales by HESS (another green light for flaring) don’t know if they will get anything from this hard work.”
Guyana’s First Peoples not getting their fair share
He further added, “The indigenous people will get 15% for projects within their communities. I recently read an article that said they would like to manage their own funds. I have no clue how that will go down with this government.
“The forestry sector operators received nothing from these carbon credits sales even though their forests were assessed. Despite spending hundreds of millions to ensure Sustainable Forest Management (SFM) and hundreds of millions to maintain internal roads that other sectors such as Gold are using. Nothing for them, Mr. speaker. Persons who own private lands and titled lands their forest were assessed, nothing for them, Mr. speaker.
“What I expected in the budget out of the US$150 million to be collected 15% for the indigenous people was given which amounts to US$11,250,000. US$10 million for the revolving fund for the forestry sector. $3 million for the Guyana Forestry Commission operation…the balance remaining is US$125, 750 million that can go directly to the Consolidated Fund,” he expounded.
“The growth of the forestry sector as mentioned in the Budget Speech by 13 % approximate. if that is true, I must give credit where it is due, but allow me to put my arguments. Sir, at the end of the year stakeholders are asked to submit something called ‘jungle stocks’ that comprised of wood or timber on forest log-markets or at stumps. This is not out from the forest as yet but it is submitted on a removal permit where the prescribed royalties are paid. This will add to the approximate 441,000 cubic meters that was alluded to in the budget speech.”
Interior roads are in a deplorable state
Mr. Speaker, interior roads are in a deplorable state, where the major activities of logging are taking place, the Mabura roads while the budget speech was being read a bridge by the Kurupukari collapsed, the hydro roads to 14 miles roads is in a terrible state, contract was awarded but no works is being done.”
He closed stating, “In addition, Mr. Speaker, the quality of interior roads is very poor, that is why the coalition government awarded roads to loggers to be built. Kwakwani to Linden Road is also in a bad state, rock stone road to Iteballi to Bartica is in a bad state. How then Mr. speaker that this approximate growth reached to 13 %!,” the MP concluded.