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BREAKING: Appeal Court stays suspension of ExxonMobil’s Liza 1 operations, orders US$2 billion clean-up deposit

Last Updated on Thursday, 8 June 2023, 11:52 by Denis Chabrol

The Guyana Court of Appeal on Thursday ordered a stay of a High Court suspension order of the Liza 1 operations if ExxonMobil does not provide an unlimited financial guarantee for any clean-up that may be caused by an oil spill.

Noting that there was a reasonable prospect for success of an appeal, Justice of Appeal Rishi Persaud also ordered that ExxonMobil local subsidiary, Esso Exploration and Production Guyana Limited (EEGPL) lodge US$2 billion within 10 days with the Environmental Protection Agency (EPA) should there be an oil spill.

“I do concede of prospects of success in the interest of justice,” the judge said.

The judge said if the money was not lodged, “the stay order stands dismissed.”

High Court Judge Sandil Kissoon had  that effectively given the EPA until June 10, 2023 to have unlimited parent company guarantee and/or unlimited liability affiliate company guarantee to finance the cost of any chemical pollution or the licence would be suspended.

Mr Seenath Jairam, lawyer for the applicant Fred Collins, asked that the court order that the appeal be heard urgently but Justice Persaud said he would only urge that it be done soonest. “I will craft something to that effect but there are procedures available…I will tie it into the order,” the judge said.

Justice Persaud noted that President of ExxonMobil Guyana , Alistair Routledge said I’m his affidavit that the company and Guyana would suffer significant financial losses. Mr Routledge said the revenue loss to the permit holder and more importantly to the State of Guyana will have serious implications and devastating consequences in the event of a permit suspension,” he said, adding that there would be seeming uncertainty about what an unlimited assurance might entail and the time frame ordered to do so makes the concern problematic. “The prejudicial effects are palpable,” he said. Mr Routledge said a well blowout or another environmental disaster was unlikely.

He stated it appeared as though government’s EPA could be considered an expert body “which ought to have prompted judicial restraint.”

Esso Exploration and Production Guyana Limited was represented by lawyers Edward Luckhoo and Andrew Pollard.

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June 2023