The recently awarded Payara offshore development licence features significant new clauses missing from the Liza 1 well licence which makes it more environmentally friendly.
The Liza 1 licence, which was issued by the former APNU+AFC administration contained several ambiguous clauses which resulted in less than environmentally friendly operations.
According to DPI, Joel Gravesande, Senior Environmental Officer at the Environmental Protection Agency (EPA), said that there is a vast difference between the two licences. This is due to the fact that the EPA has gained more experience since oil production commenced in December 2019 and are now better guided.
“That experience was placed in drafting the Payara permit, hence the reason you would see more stringent language used,” he was quoted by DPI as saying.
One of the major environmental issues is flaring of natural gases which has been better addressed in the Payara licence. A lot of the parameters are also better defined. The permit stipulates that the company would have 60 days from start-up to achieve flare out.
In the event that this does happen, the operator has the option to approach the EPA for an extension.
“If they don’t achieve it, they will come to the EPA we would give them a licence based on our approval. It is not how it is in the Liza 1 where the language is a bit ambiguous and can be interpreted however they please.” he said.
The agreement provides for the testing of water extracted with the crude (produced water) prior to it being expelled into the ocean. The EPA will play a major role in testing the water regularly. The EPA official said that a study will be conducted to determine the feasibility on whether the produced water should be reinjected into the wells or discharged overboard.
A clause which stipulates wells must be sealed within five days of oil spills was also included in the Payara permit. According to the EPA official, the operator is required to have a well cap on hand to be prepared in the event of a spill.
In addition to there being an EPA official on board the Floating Production and Offloading Vessel (FPSO), the operator is required to submit daily reports on flaring volumes, produced water and oil production.
At the signing last month, Minister of Natural Resources, Hon. Vickram Bharrat stated that the Government of Guyana had negotiated for fines and penalties to be included in the Payara contract in the event the operators breached the agreement.
“The Environmental Protection Agency will institute fines for pollution and the Government of Guyana will also introduce penalties for the wastage gas because the flaring means that we are wasting the gas which can be utilised in a more meaningful way,” Minister Bharrat had said. (Extracted and modified from DPI)