a project of

Moving in on Guyana

However, the oil fields ExxonMobil, Hess and CNOOC have discovered in the Guyana-Suriname Basin are huge and manifold. In 2015, the companies hit a gigantic oil field in their Stabroek Block.^[18] ExxonMobil drilled a 7,176 m (23,543 ft) deep well to reach the oil.^[19] The well, Liza-1, lies 190 km (118 mi) off Guyana’s coast.^[20]

ExxonMobil is eagerly betting against the climate to find and extract as much oil out of the deep sea as quickly as possible.¹²³⁷³ In December 2019, ExxonMobil, CNOOC and Hess delivered “First Oil” from the Liza 1 project.^[21] In April 2022, ExxonMobil announced that it would spend USD 10 billion on its newest Guyanese oil project, YellowTail. The news came less than two weeks after the Intergovernmental Panel on Climate Change (IPCC) published yet another damning report on global warming. ExxonMobil’s plans to pump up to 250,000 barrels per day out of the seafloor at YellowTail clearly show that the company is recklessly opposed to the energy transition.^1237512377 For its profits, ExxonMobil is prepared to leave investors as well as Guyana exposed to the risk of stranded fossil fuel assets. The company is putting all its weight behind the Guyana plans and has now begun to concentrate most of its industrial supply chain equipment at Guyana’s coast.^[24] Other international oil and gas companies, like Frontera Energy and Repsol, are also hoping to make big money off Guyana’s wealth of resources.¹²³⁷⁹

Breaching Guyana's Strict Environmental Standards

ExxonMobil, Hess and CNOOC are better at finding oil than at meeting Guyana’s environmental standards. The Environmental Impact Assessments for ExxonMobil’s oil projects have been flawed and might not have met Guyanese legal requirements.^1238112383 For its first project, Liza 1, ExxonMobil failed to spend the necessary time and money to engage marine scientists to map the plants and animals that live and migrate along the South Caribbean coast.^[26] The threats to fish and marine mammals in the open sea, to crabs and smaller sea animals in the shallow coastal waters and to birds and fish that breed in the mangroves will grow as ExxonMobil, CNOOC and Hess’ oil exploitation continues.

Deathly Seismic Exploration

Searching for oil and gas in the deep waters off Guyana’s shore comes with devastating effects for marine life. The geophysical surveys to understand the location and the extent of oil and gas deposits include methods that strongly impact marine species. The Center for Biological Diversity describes the effects of seismic surveys: “Offshore oil and gas exploration uses deafening seismic surveys that generate the loudest humanmade sounds in the ocean, short of those made by explosives. Seismic testing involves blasting the seafloor with high-powered air every 10 seconds and measuring the echoes with long tubes to map offshore oil and gas reserves. These blasts disturb, injure and kill marine wildlife around the clock for years on end.”^[27]

ExxonMobil and other oil companies continue exploring for oil and gas off the coast of Guyana. The company’s self-proclaimed goal is to drill 20 exploration wells in 2 years.¹²³⁸⁵ The exploration is likely to result in grave harm to rare sperm whales and other marine animals. It can disturb their migration pathways and their feeding and breeding habits. All of this is happening despite the global energy market’s irreversible move to renewable energy, and the IEA’s statement that there should be no new oil production.

What Happened to Guyana’s Benefits?

Guyana’s former government negotiated contracts that shifted all the risks to Guyana and the benefits to ExxonMobil, Hess and CNOOC.^{[28] 12387} It is not surprising that the contract conditions are so one-sided. The government secretly accepted a signing bonus of USD 18 million from ExxonMobil and illegally placed it in a secret account.¹²³⁸⁹

Adding to the concerns, the former head of the Guyanese Environmental Protection Agency has questioned the insurance of ExxonMobil’s projects. ExxonMobil operates through a small offshore subsidiary. In the event of an oil spill, the people of Guyana may well end up bearing the costs of cleaning up pollution, shutting down the wells safely and compensating their Caribbean neighbors.¹²³⁹¹

At the same time, the Stabroek Production Sharing Agreement with the Guyanese government is highly favorable to ExxonMobil, CNOOC and Hess.^{[30] [31]}  The government has actually admitted that the agreement is weak.¹²³⁹³ The Vice-President, in his former role of Leader of the Opposition, denounced the contract as one that would harm Guyana but has since become its staunch defender.^1239512397

The Production Sharing Agreement exempts ExxonMobil, Hess and CNOOC from paying many annual income taxes.¹²³⁹⁹ It also dictates that Guyana first has to pay all of ExxonMobil's development costs before it gets its share of the profit.^{[33] 12401} Guyana’s contract with ExxonMobil is structured in such a way that ExxonMobil can continue to charge Guyana for every newly developed oil field and for every failure such as a dry well. While the companies cash in, many people in Guyana are becoming poorer.¹²⁴⁰³ With prices increasing, families have to decide whether to pay for food, electricity or childcare.¹²⁴⁰⁵

In-Country Resistance

The Guyanese people are increasingly opposed to the oil project because of the risks for Guyana's people and environment. International lawyer Melinda Janki is leading the fight against ExxonMobil and court cases against the oil projects in Guyana are beginning to pile up. She has already filed 6 cases against the oil project. The first case, which challenges the Petroleum Production Licence, has just been heard by the Court of Appeal and the parties now await the decision. In the second case, the court cut ExxonMobil’s environmental permits down from 23 years to 5 years.^[34] The third case was filed in May 2021 and is the first climate change constitutional case in the Caribbean. It is also the biggest climate change case in the world challenging more than 4 billion tons of greenhouse gas emissions. The case challenges the oil project as contrary to the right to a healthy environment.¹²⁴⁰⁷ The litigants are a scientist, and an indigenous Wapichan person from the Rupununi region in southern Guyana.^[36] They argue “that the government breached its legal duties to protect its citizens’ rights to a healthy environment, sustainable development, and the rights of Guyana’s future generations” when it approved the ExxonMobil-led oil and gas development.^[37] This case is currently proceeding in the High Court. The fourth case demands an end to ExxonMobil’s flaring activities, which Janki and her clients consider unlawful.¹²⁴⁰⁹ Since September 2022, Guyanese oil projects face two more lawsuits. Guyanese citizens have challenged the latest permit for an ExxonMobil-led oil project that has been granted without an Environmental Impact Assessment.¹²⁴¹¹ In a separate case, other Guyanese citizens aim to make sure that ExxonMobil takes full responsibility for its offshore oil operations in case of an oil spill or other environmental harm.¹²⁴¹³ More cases are likely to follow in the future, and pressure on ExxonMobil and its oil allies will inevitably increase.