60-day start-up flaring allowance well below int’l benchmark – EPA
The Environmental Protection Agency (EPA) on Friday defended the 60-day start-up allowance for flaring, stating that this provision is far below the international benchmark.
In a statement, the EPA refuted media reports on the flaring allowance in the Environmental Permits for the Liza 1 and Payara Development Projects. It expressed strong disagreement with two articles “Payara clause could allow Exxon to flare gas for free” and “Govt has weakened environmental standards in favour of ExxonMobil”.
The Agency categorically stated in the missive that allotted flaring for 60 days is only permissible for “start-up” in both permits.
“International benchmarking shows that the typical acceptable start-up period for installations of this nature average 90 days; therefore, the EPA’s 60-day requirement is much more stringent as it is well below the average international benchmark. As far as the EPA is aware, there was never an agreement to prescribe two days of start-up since this was impossible given the nature of the installations,” the agency posited.
The EPA went on to point out that it is erroneous to contend that there is “no provision to stop flaring after sixty days” since both permits specifically state: “The Permit Holder shall not exceed sixty (60) days of flaring during Start-up.”
Moreover, the agency outlined that there is no “carte blanche” for flaring under ‘Special Circumstances’ either, as the company is required to seek approval from the EPA for any flaring beyond 48 cumulative hours. It added that routine flaring and venting are also strictly prohibited by both permits.
“The EPA maintains and reserves the right to reject any request for flaring made pursuant to these Permits and if an approval is given, the EPA may include such terms and conditions as may be appropriate, including reduced timelines for any proposed flaring events,” Friday’s missive detailed.
Further, it was reminded that pursuant to Condition 3.17 of the Payara Environmental Permit, the EPA has established a payment for CO2 equivalent emissions as a result of flaring at the rate of US$30 per tonne of CO2e, consistent with similar mechanisms included in the modified Liza 1 Permit. The institution and applicability of this payment is determinable by the EPA, in consideration of the Polluter Pays Principle. The EPA added that it reserves the right to increase this rate where any instance of flaring exceeds 60 days.
Meanwhile, in response to Stabroek News article’s claim that the 36-day period approved for flaring under the Liza 1 Modified Environmental Permit had expired, the EPA clarified that at the date of the article’s publication, the approval issued to the company was still in effect.
According to the Environment oversight body, the Modified Permit requires that the payments be made to the EPA within 28 days of the expiration of the approval in order to ensure it is calculated based on the actual volumes as well as sound internationally-recognised methodologies.
“To this end, the EPA refutes any allegations that it lacks the requisite capacity and capabilities to perform the necessary calculations. The EPA boasts a wide variety of professionals qualified in environmental management, chemistry, engineering and other pertinent fields, and recruits additional expertise, local and international as necessary. The EPA views the Payara Environmental Permit and the Modified Liza 1 Environmental Permit as marked improvements, particularly in consideration of the more specific flare management conditions that are consistent with industry practice in order to regulate and/or deter periods of flaring,” the agency stressed.
It went on to outline that the Payara Permit, specifically, was a major improvement in that it also included provisions for produced water management, cradle to grave waste management, insurance requirements and reporting mechanisms; which were notably absent from the Liza permits.
“The EPA wishes to assure the public that it has pursued, and continues to pursue environmental safeguards and deterrent mechanisms to address any prolonged periods of flaring which may pose risks to the environment, consistent with best-practice and international standards,” the agency asserted.
The US$9 billion Payara development, which was approved in October last year, will target an estimated resource base of about 600 million oil-equivalent barrels. Ten drill centres are planned along with up to 41 wells, including 20 production and 21 injection wells.