Guyana’s Environmental Protection Agency (EPA) has collected approximately GY$400M in payments from ExxonMobil for flaring to date. Head of the agency, Kemraj Parsram, made the disclosure on Thursday during a local radio programme – Guyana’s Oil and You.
This follows an amendment to the Liza Phase 1 Environmental Permit announced on May 13, 2021. The revised Permit features modified terms and conditions relating to the emission reporting requirements, technical considerations for flaring, and timelines for flaring events. Additionally, the revised Permit contains an obligation on ExxonMobil Guyana to pay for the emission of Carbon Dioxide (CO2 equivalent) as a result of flaring in excess of these timelines.
Parsram noted that ExxonMobil in the last few months, particularly prior to July, was flaring 15 million standard cubic feet (mscfd) of gas per day but this has since been reduced to 6 million standard cubic feet. On this note, he said the company is expected to reach pilot flaring levels by year-end.
Additionally, the EPA head said the flaring payment was increased to US$45 per tonne of CO2e to serve as an incentive to ensure compliance.
ExxonMobil had said in an update at the end of July that the gas compression system on the Liza Destiny FPSO was back online.
“All systems are currently online. We are…using some of the gas to run our power generators offshore. We are injecting and consuming approximately 96% of that produced gas,” Mike Ryan, ExxonMobil Guyana Production Manager said at the time.
OilNOW reported on July 31 that EPA had approved an additional 60-day period for flaring of associated gas on the Liza Destiny FPSO for the period July 25 to September 22, 2021. The US$45 tonne payment will be applied to this period.
Parsram said, “The EPA and by extension, the government’s policy is zero routine flaring. Flaring is only permitted in circumstances where it is necessary to ensure safety and in cases of emergencies. We know there are issues with the compressor [for the Liza Destiny FPSO] and we have been working with the operator…It must be noted that the operator has been and continues to show, efforts in addressing the matter and in meeting compliance.”