The Guyana Government has announced that it will be challenging the decision of High Court Judge Sandil Kissoon, who on Wednesday ordered the Environmental Protection Agency, (EPA) to issue an Enforcement Notice to Esso Exploration and Production Guyana Limited (EEPGL) and its parent company, Exxon Mobil to ensure it provides unlimited insurance coverage to safeguard Guyana against the devastating effects of an oil spill.

The judge in his ruling declared that the Environmental Protection Agency breached its statutory duty by failing to enforce compliance by Esso Exploration and Production Guyana Limited (EEPGL) of its Financial Assurance obligations to provide an unlimited Parent Company Guarantee Agreement and/or Affiliate Company Guarantee Agreement to indemnify and keep indemnified the EPA and the Government of Guyana against all environmental obligations of the Permit Holder and Co-Venturers within the Stabroek Block, Offshore Guyana.

Justice Kissoon also said ExxonMobil “engaged in a disingenuous attempt” to dilute its obligations under its environmental permit for Liza One, the project that saw Guyana’s oil production in 2019.

In a statement today, Attorney General Anil Nandlall said the government is not in agreement with the ruling and will be approaching the Guyana Court of Appeal for its pronouncement on the matter.

“The EPA and the Government of Guyana are of the considered view that the Environmental Permit imposes no obligation on the Permit Holder to provide an unlimited Parent Company Guarantee Agreement and/or Affiliate Company Guarantee Agreement. In this regard, we hold the respectful opinion that the Learned Judge fell into error in his findings. This ruling can have profound ramifications and grave economic and other impacts on the public interest and national development. As a result, the decision of the Learned Judge will be appealed and orders will be sought to stay its effect until the hearing and determination of the appeal,” the Attorney General said in his ruling.

According to Mr.Nandlall, the Environmental Protection Agency and EEPGL spent almost a year negotiating a Parent Guarantee and Indemnity Agreement to the tune of US$2 billion in liability coverage in compliance with EEPGL’s financial assurance obligations under the Environmental Permit and the Environmental Protection Act.

The negotiations, the AG said concluded last week.

Though those negotiations and their material details were placed before the Court for its consideration, they were rejected by Justice Kissoon.

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