Guyana regulator moves to overturn court judgment on Exxon assurance guarantee

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The Environmental Protection Agency (EPA) has filed an appeal against a recent upset judgment by the High Court. Justice Sandil Kissoon directed the EPA to secure an unlimited parent and/or affiliate guarantee, based on a provision in ExxonMobil Guyana’s revised Liza 1 environmental permit. 

In the submission filed by Attorney-at-Law, Sanjeev Datadin on behalf of EPA Head, Kemraj Parsram, it was noted that the agency does not agree with High Court Judge, Justice Sandil Kissoon that the permit requires unlimited coverage from ExxonMobil. 

Parsram said the permit allows for the provision of an estimate to guide the amount to be accepted as a guarantee. Further, he noted that the EPA Act underpins that financial assurance shall be specified in a permit, adding that the law supersedes the permit when there is doubt about what it requires.  

Parsram also contended that the law affords the EPA a level of discretion in carrying out its duties as a public authority. He said the court cannot direct how this discretion is to be exercised.

Significantly, the Guyanese regulator through its Counsel argued that it is coercive for the court to order that the guarantee be provided by June 10 or face cancellation of the Liza Phase 1 environmental permit. 

The EPA Chief said such a move would have devastating economic effects. He said too that it is a public fact that Guyana is now the fastest-growing economy in the world. 

“Similarly, it is acknowledged that Guyana’s unprecedented economic growth is in large part due to the exploitation of our petroleum reserves. The permit which is at the center of this dispute…is critical to the economic activity in Guyana,” Parsram said in the appeal. 

He also highlighted that Guyana now earns billions of (Guyana) dollars annually from the petroleum activities conducted at the Liza fields. Taking this into account, the EPA Director said the suspension or cancellation of the permit will have a catastrophic effect on national funds for development and on the private sector which supports the activities of the project.

He said therefore that it is imperative that the Appeal Court grants a stay of execution of the judgment of the High Court which was issued May 3, 2023. 


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