Collins and Whyte v EPA and Esso

Melinda Janki is an international lawyer, attorney-atlaw in Guyana, and the recipient of the prestigious Commonwealth Lawyers Association Lexis Nexis Rule of Law Award 2023.

Last week, two ordinary citizens did what everybody said was impossible. They went to court and beat the Environmental Protection Agency and Esso Exploration and Production Guyana Ltd., a subsidiary of oil giant ExxonMobil Corporation.

The decision by His Honour Justice Sandil Kissoon is a textbook example of clarity, logic and good sense. It is grounded in law and legal principles. It is independent and impartial as a judicial decision must be. But, perhaps most important of all, His Honour has put the rule of law and his own constitutional duty to our nation above the interests of ExxonMobil and the government’s political agenda. In doing so, he has set a standard for judges around the world, not only in Guyana.

On a more practical level, this decision when implemented will protect Guyana, the people of Guyana and the Government of Guyana from potential liability of US$ billions. For that alone, the Guyanese people should be dancing in the streets. And the servants of the people, the President, Vice-President, Attorney-General and ministers, should likewise be celebrating.

On 31st May 2022, Alastair Routledge, the president of Esso, signed the environmental permit for Liza 1. He accepted the terms and conditions, including Condition 14 which required Esso to provide insurance and a parent company guarantee/indemnity. The position of the Applicants’ legal team was that there was non-compliance with the letter, spirit and intention of Condition 14.

Mr Routledge had stated on oath in his affidavit before the court that Esso had complied with the Environmental Permit. The court, on the contrary, found on the evidence before it that Esso was engaged in a disingenuous attempt which was calculated to deceive when it sought to dilute its liabilities and settled obligations as expressed in clear and unambiguous terms in Condition 14 of the permit.

The EPA, the regulator, did not carry out its mandate and require Esso to comply with Condition 14. The court found on the evidence before it that the EPA abdicated its responsibilities and relegated itself to a state of laxity of enforcement compounded by a lack of vigilance, thereby putting this nation and its people in grave potential danger of a calamitous disaster.

Could Exxon get away with flagrant breach in the USA, Canada or UK? Take one guess.

If anyone is curious about the relationship between the EPA and Esso, look at ExxonMobil’s Proxy Statement 2023 which assures shareholders that, “ExxonMobil’s local affiliate works cooperatively with the Guyana Environmental Protection Agency to ensure environmental permitting relating to exploration, development, and production activity fully complies with Guyana law.” An effective regulator must be independent of government and industry, and must enforce not cooperate.

By now everybody in Guyana must know that deep (This is one of a series of weekly columns from Guyanese in the diaspora and others with an interest in issues related to Guyana and the Caribbean)

water drilling for oil is a very dangerous activity. It requires up to date technology and strict adherence to safety procedures. And yet, Esso has admitted in court to using faulty equipment and has publicly boasted about producing oil above the safety limits of its Floating Production Storage and Offloading vessels (FPSOs). Esso’s maps show that an oil spill could reach as far as Jamaica. As the judge observed, “If the unthinkable occurs and there is an event resulting from the Added Respondent’s [Esso’s] operations, the consequences will be devastating not only to the citizens of this land and the environment but to inhabitants of neighbouring states and territories.”

The permit says that Esso is liable for associated with clean up, restoration and compensation for any damages caused by any discharge of any contaminant.” The judge held that ‘all’ costs means ‘all’ costs. There is no limit to Esso’s liability. In legal language Esso has “unlimited and uncapped liability for all costs.” That’s what Esso agreed to in return for getting the permit.

The clean-up costs for BP Macondo in 2010 were