Unlimited liability case: Court of Appeal clears Exxon’s US$2B environmental guarantee deal with EPA 

The Court of Appeal (COA) on Thursday reversed a 2023 judgement by Justice Sandil Kissoon and ruled in favour of ExxonMobil and the Environmental Protection Agency (EPA), saying it is the environmental oversight body and not the courts that sets the financial assurance standards for project permits.
The ruling, delivered unanimously, sets aside Justice Kissoon’s orders and affirms the EPA’s discretion in determining the financial assurance required under Exxon’s environmental permit, as it is that body and not the courts that is so responsible.
Guyana Times understands that the Applicants will be appealing Thursday’s decision to the Caribbean Court of Justice (CCJ).
Applicants Frederick Collins and Godfrey Whyte had argued that ExxonMobil was obligated to lodge an unlimited financial guarantee to cover potential environmental damage from its offshore petroleum operations. Justice Kissoon had previously ruled that Exxon’s liability was unlimited and uncapped, and therefore its financial assurance must also be unlimited. He had directed the EPA to enforce this requirement, warning that Exxon’s permit could be suspended if it failed to comply.
Justice Kissoon had found that Exxon had been knowingly in breach of its obligations to lodge unlimited financial assurance by seeking to lodge a guarantee of US$2 billion and that the EPA was in breach of its obligations to enforce the provisions of the permit by allowing Exxon to do so.
He ordered the EPA to issue an enforcement notice against Exxon if it failed to lodge an unlimited guarantee within 30 days and directed that Exxon’s environmental permit be suspended if compliance was not achieved.
ExxonMobil and the EPA immediately appealed, arguing that Justice Kissoon had misinterpreted the law and exceeded his authority. They contended that the Environmental Protection Act vested discretion in the EPA to determine the form and amount of financial assurance and that the court had erred by substituting its own judgement for that of the regulator.
The Court of Appeal, after hearing arguments from all parties in February 2026, on Thursday rejected Justice Kissoon’s interpretation. The Judges ruled that while Exxon is indeed liable for all environmental damage it causes, liability and financial assurance are distinct concepts. The EPA, they held, has the statutory discretion to determine the appropriate level of financial guarantee, and the US$2 billion guarantee negotiated between Exxon and the EPA was lawful and valid.
The COA ruled that the EPA has discretion under the Environmental Protection Act and the permit to accept a guarantee for a defined sum. Justice Kissoon erred by substituting his own discretion for that of the EPA, which is the sole body authorised by Parliament to make such decisions.
The court held that Exxon and the EPA had not acted improperly in negotiating a US$2 billion guarantee. It found that Justice Kissoon had no evidence before him to support his conclusion that the insurance policy lodged by Exxon was not consistent with international petroleum industry standards.
ExxonMobil was represented by Andrew Pollard, SC; Edward Luckhoo, SC; and Eleanor Luckhoo. The EPA’s legal team included Sanjeev Datadin and Mohanie Anganoo. The applicants, Collins and Whyte, were represented by Seenath Jairam, SC; Saevion David-Longe, Melinda Janki; and Abiola Wong-Inniss. The Attorney General’s Chambers was represented by Arud Gossai and Shoshanna Lall.