ExxonMobil to pay gov’t US$1.3 million for excess flaring offshore Guyana

The government is expected to be paid some US$1.3 million from ExxonMobil Guyana in fines for the excess flaring of natural gas from its Liza Phase 1 Development.

Vice President, Dr. Bharrat Jagdeo, relayed this to the media during his press conference on Friday at the Arthur Chung Conference Centre.

Dr Jagdeo explained that ExxonMobil is expected to start paying the charge on May 26 – more than a week after agreeing to pay a US$30 flaring charge to the Environmental Protection Agency (EPA).

The Vice President explained that ExxonMobil Guyana applied for an allowance to flare for 36 days, beginning May 25 due to a malfunctioned flash compressor aboard the Liza Destiny vessel.

By the end of that period, the oil company should have that problem fixed.

“…. they say they’re flaring about 15 million cubic [feet] per day now. That will be equivalent to about 1,152 tonnes of Co2 equivalent, or just below that for carbon dioxide,” Dr Jagdeo explained.

Only on May 13, the EPA announced that it recalled the Liza Phase 1 Environmental Permit and modified it to include specific provisions to tackle flaring offshore Guyana.

Revised terms and conditions in this permit include emissions reporting requirements, technical considerations for flaring, timelines for flaring events, and an obligation on the company to pay for the emission of Carbon Dioxide equivalent (CO2e) as a result of flaring in excess of these timelines.

That payment is calculated at the rate of US$30 per tonne of CO2e and is payable to the EPA.

As per the Environmental Impact Assessment (EIA) for this Liza project, it was estimated that the oil producer would flare about 14 Billion Standard Cubic Feet (Bcf) of gas when production began.

Due to technical issues with the flash gas compression system, gas flaring offshore Guyana was recently resumed following intermittent periods of flaring since December 2019.

The company was projected to exceed the estimated amount to be flared for the project on May 13, 2021.