EPA orders ExxonMobil Guyana to provide unlimited parent-company guarantee coverage

…order issued in compliance with court order – Executive Director

Even as it continues the fight in the Court of Appeal to overturn the High Court order, the Environmental Protection Agency (EPA) has issued an Enforcement Notice to compel ExxonMobil Guyana to provide unlimited liability parent company guarantee for its Stabroek Block holdings.
Last month, High Court Justice Sandil Kissoon had ruled that the Environmental Protection Agency (EPA) must order Exxon to provide unlimited parent company guarantee. Even as its appeal of that decision goes forward, EPA lost its bid to stay Justice Kissoon’s order.
As a consequence, the agency has issued the Enforcement Notice.
This was confirmed when this publication made contact with EPA Executive Director Kemraj Parsaram. In fact, Parsaram maintained that the agency issued the notice as of May 9, 2023, in compliance with Justice Kissoon’s order.
“As we indicated in the court matter, we did issue that enforcement notice…it was done immediately. From the time the order was given, May 9,” the Executive Director explained to this publication.
In the meantime, EPA continues the fight to overturn Justice Kissoon’s ruling at the level of the Court of Appeal. During Wednesday’s hearing before Court of Appeal Judge Rishi Persaud, Senior Counsel Seenath Jairam said EPA and Exxon were in contempt of court. However, this was refuted by Attorney-at-Law Sanjeev Datadin, who is representing EPA, who also confirmed that the Enforcement Notice was issued. It is meanwhile expected that Justice Persaud would provide a date for his ruling by next week.
In September 2022, the President of the Transparency Institute of Guyana Inc (TIGI), Fredericks Collins, and Guyanese citizen Godfrey Whyte had moved to the court to get the EPA to implement the liability clause in the permit issued to ExxonMobil (Guyana) for its operations.
They wanted the court to ensure Esso Exploration and Production Guyana Limited (EEPGL) takes full financial responsibility in the event of harm, loss, and damage to the environment from a well blowout, oil spill, or other failures in the Stabroek Block.

Attorney-at-Law Sanjeev Datadin

On the issue of whether the EPA acted in breach of its statutory duty and unreasonably permitted Esso to carry out petroleum production operations in the absence of compliance with the terms of the permit, Justice Sandil Kissoon ruled that the EPA has committed an illegality, acted unlawfully, ultra vires, unreasonably, in defiance of logic, irrationally, and without any jurisdiction. Hence the court ordered that the agency issues the Enforcement Notice to EEPGL on or before May 9 to provide an unlimited Parent Company Guarantee Agreement and/or unlimited liability Affiliate Company Guarantee; and failure to do so would result in the suspension of its Environmental Permit.
Since Justice Kissoon’s ruling, both the People’s Progressive Party/Civic (PPP/C) Government and the Private Sector have expressed concerns regarding the ruling. Attorney General and Legal Affairs Minister Anil Nandlall, SC, had contended after the ruling that the Environmental Permit imposes no obligation on the Permit Holder to provide an unlimited Parent Company Guarantee Agreement and/or Affiliate Company Guarantee Agreement.

Attorney-at-Law Sanjeev Datadin

The Private Sector Commission (PSC) had meanwhile issued a statement stating that it is “profoundly concerned over the controversy which has arisen” regarding the ruling handed down in the matter of “Collins & Whyte vs The Environmental Protection Agency (EPA)”.
Recognizing that it is bound by the fact that the case is sub-judice, the Commission nevertheless registered its view that the outcome of this legal battle holds “considerable significance” to the future of Guyana. Amid the appeals, the PSC said, it looks forward to “ultimately clarifying the legal issues at stake with a view to (having) an amicable resolution”.
In the meantime, the Commission invited all of Guyana to give “serious thought and reflection” to where the country is today in terms of the significant infrastructure and transformative developments which have already taken place as a result of the investments made by ExxonMobil. (G3)