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Last-ditch threat to oil exploration

THE STENA Icemax.

THE STENA Icemax.

* Activists to launch BPC legal challenge in 14 days

* Will seek injunction unless voluntary halt agreed

* Say Gov't failed to follow lawful approval process

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Environmental activists last night threatened to initiate legal action against the Government and Bahamas Petroleum Company (BPC) within 14 days unless the latter halts its oil exploration plans.

photo

Attorney Fred Smith QC

Fred Smith QC, the Callenders & Co attorney and partner, fired off multiple letters to the Prime Minister, Cabinet ministers and relevant government agencies warning that his clients will seek to obtain a Supreme Court injunction blocking BPC's activities until such time as the merits of their Judicial Review are determined.

Acting on behalf of the Our Islands, Our Future group, as well as Waterkeeper Bahamas and a "coalition" of unnamed "Bahamian citizens, local businesses and local and international environmentalists", Mr Smith argued that the approvals granted to BPC breached assurances given by Dr Hubert Minnis, were contrary to the nation's international obligations, and did not follow legally-mandated processes.

In a letter to BPC's chief executive, Simon Potter, which was sent just hours after it revealed the vessel hired to drill its first well is poised to leave the Canary Islands for The Bahamas before end-November, Mr Smith urged the company to avoid the need for an injunction battle by giving a voluntary "undertaking" not to proceed with the project.

"We... invite you to undertake not to proceed with the project until such time as a full and proper public consultation process has taken place," the Callenders & Co attorney urged Mr Potter.

"We hereby put you on notice that absent a satisfactory response within 14 days to this letter or to our letters sent today to the [government], we are instructed by our client to apply to the court for leave to bring Judicial Review proceedings."

These, Mr Smith said, will focus on challenging the Government's February 2020 decision to approve BPC's Environmental Impact Assessment (EIA), and subsequently issue its Environmental Authorisation (EA), "without proper consultation or at all". It will also tackle similar issues with what he described as BPC's revised EIA.

"As part of this Judicial Review application we will be seeking an injunction preventing you from embarking on the project pending final determination of the Judicial Review," he told Mr Potter. "To obviate the need to obtain such an injunction, we therefore invite you now to undertake not to proceed with the project until the final determination of any Judicial Review challenge launched by our clients."

The move threatens to throw a last-minute wrench into BPC's plans to spud its first exploratory well, Perseverance One, in Bahamian waters just before Christmas 2020. The oil explorer, in an update issued yesterday, said Stena Drilling, providers of its drill ship, had formally notified it that the vessel will begin operations on December 15.

"BPC anticipates that it will take four to five days from this start date for the rig to be provisioned, loaded and then transitioned to the drilling location for spud of the well," the oil explorer said yesterday. However, that timeline for a project BPC says it has invested more than $100m on over the past 13 years, has now been thrown into doubt at the last minute if Mr Smith and his clients are successful.

Any Supreme Court-enforced delay could prove extremely costly to BPC and its shareholders, including the Bahamian investors who also recently bought into the company via a private placement.

Reaction to the efforts of Our Islands, Our Future and its environmental partners is likely to be mixed given that the issue of oil exploration in Bahamian waters is highly divisive. Some view it as a potential 'game changer' that the Bahamian economy desperately needs, and can ill-afford to ignore, post-COVID-19 especially if commercial quantities of extractable oil lie below the seabed.

Advocates argue that The Bahamas simply cannot pass up the potential of a multi-million dollar windfall following the fiscal and social hardship inflicted by the pandemic, especially since there are few other economic diversification opportunities on the immediate horizon.

The project's opponents, though, have always voiced scepticism about BPC's ability to pull-off the project. Many have also expressed fears for the environment, and the industries that rely upon it - especially tourism and fishing - were any oil-related accidents to occur. They also argue that an oil exploration industry is not compatible with fighting the very climate change now impacting The Bahamas.

Meanwhile Mr Smith, in a separate letter to Romauld Ferreira, minister of the environment and housing, said that "owing to assurances given by the Prime Minister" and himself "our clients had a legitimate expectation that the BPC EIA and EA would not be approved or granted".

Suggesting that the Government's approvals were incompatible with its international environmental obligations and the treaties it has committed to, the QC also queried whether BPC had met the requirement in the Petroleum Act's accompanying regulations that it "satisfy" any issues raised by those affected by its potential activities before submitting an EA application.

"This is of particular interest given that you granted EA to this project without notice to Our Islands, Our Future nine months after you gave unequivocal assurances to representatives of Our Islands, Our Future and other environmental organisations that there would be no oil drilling in The Bahamas," Mr Smith told Mr Ferreira.

"It seems clear to us that neither BPC nor your department engaged in any, or any proper, public consultation in relation to the EIA or the project..... There has been a complete failure to fulfill the public consultation obligation in relation to this project. Doubtless as a result of this failure, the BPC EIA is a woefully inadequate document."

BPC has repeatedly refuted allegations that there has been little to no consultation with Bahamian stakeholder groups, citing meetings it has held with numerous fishing communities and other potentially affected parties in Andros and throughout the Family Islands.

Mr Smith, meanwhile, zeroed in on reports that BPC's EIA is being updated due to the interruptions caused by COVID-19 and the change of drill ship. Noting that the regulations accompanying the Petroleum Act require changes to an EA-approved project to be granted by the minister, meaning Mr Ferreira, he queried whether this had happened.

Arguing that the EIA would have to be resubmitted, and a new EA application made by BPC, Mr Smith suggested its Stena IceMAX drill ship "will not be able to begin drilling" until these documents were approved and a fresh round of public consultation had taken place.

"To this end we request that you suspend the EA and re-open the EIA process to allow proper public consultation to take place," he argued, while also requesting that the Government clarify whether BOC has been issued with a Certificate of Environmental Clearance (CEC) as required by the Petroleum Act.

"If a CEC has not been issued, please provide an assurance that a CEC will not be issued without our clients having an opportunity to make representations in relation to the project in general, and the EIA and Environmental Management Plan in particular," Mr Smith added.

Comments

tribanon 1 year, 8 months ago

We already know Minnis has turned his back to the Bahamian people on this most important matter. But we would also like to know the names of the other cabinet minister(s) and permanent secretary(ies) directly involved in authorising the oil drilling vessel to enter the territorial waters of The Bahamas.

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Space 1 year, 8 months ago

Didn’t the PLP authorize oil drilling?

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tribanon 1 year, 8 months ago

And don't you know who can stop the drilling, or do you prefer believing our corrupt incompetent authority can only order us poor Bahamians to do this and that, in violation of our constitutionally guaranteed civil rights and liberties, while unscrupulous foreign investors can get away with whatever they want?!

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KapunkleUp 1 year, 8 months ago

I wonder how much of a percentage the government was entitled to and what the projected total is...

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realitycheck242 1 year, 8 months ago

they have to find the oil first to work out and calculate royalty fees from the estimated total barrel in the discovery. The Bahamas oil rig , Perseverance #1, will drill in late 2020 / early 2021, with the well targeting recoverable P50 prospective oil resources of 0.77 billion barrels, with an upside of 1.44 billion barrels. Bahamas national dept possibly eliminated overnight.

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Proguing 1 year, 8 months ago

Just like in Venezuela, no more debt and everyone living in million dollar homes?

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realitycheck242 1 year, 8 months ago

Blame Venezuela failure on the Hugo Chavez government failed socialist economic policies. Why focus on one country failure when 99% of the other countries who ventured into oil drilling made huge profits with no environmental issues. Technology has advance since the deep water horizon accident and BPC will be using industry best practices with third party monitoring of all procedures on behalf of the government.

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Proguing 1 year, 8 months ago

"Bahamas national dept possibly eliminated overnight." How many oil producing countries have eliminated their debt? It's that type of argument that strips all credibility to your post.

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tribanon 1 year, 8 months ago

@realitycheck242: You're too transparently loaded with so much BS that anyone standing away from you can still clearly see it oozing out of your ears. And anyone standing closer to you can actually smell it! LOL

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concerned799 1 year, 8 months ago

Or Nigeria where it is a paradise after decades of oil drilling? The money will never see the people, only the oil spills will reach the common man!

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KapunkleUp 1 year, 8 months ago

If what you say is true than I think the government should hold a national referendum. Once all the numbers are firm and the rest of deal is worked out, let the people decide whether or not to go go ahead.

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donald 1 year, 8 months ago

If money goes to the government, then where does it go?

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ScubaSteve 1 year, 8 months ago

Someone needs to sink that ship before it arrives!!

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KapunkleUp 1 year, 8 months ago

ScubaSteve is looking for a new wreck to dive.

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ScubaSteve 1 year, 8 months ago

HA! I actually hadn't thought of that. Too funny!

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Proguing 1 year, 8 months ago

All we need now is one more disaster like an oil spill and it's game over for the Bahamas

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Voltaire 1 year, 8 months ago

The legality of the permitting process has been called into question. BPC now needs to stand down and respect the courts of the Bahamas. If they try to rush through to drilling, it will be a sign of their utter contempt for our rights.

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Bahama7 1 year, 8 months ago

I for one hope they drill. All processes have been followed and these guys are using the best in the business to drill, Halliburton etc.

Bahamians have known about BPC for years so there’s no case to argue. I doubt this will even get to court.

The economy needs this investment.

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Voltaire 1 year, 8 months ago

Of course you do. You work for them.

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Voltaire 1 year, 8 months ago

It is amazing that you think you are fooling anybody.

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ThisIsOurs 1 year, 8 months ago

HALIBURTON???? That's the name that's supposed to give us confidence??

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Space 1 year, 8 months ago

Hahaha hello BPC public relations manager. Tough day?

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concerned799 1 year, 8 months ago

Can you run a projected Bahamas GDP number over a year post an oil spill and let me know what you come up with once all the tourists stop coming?

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ColumbusPillow 1 year, 8 months ago

What are the "international obligations" stopping hydrocarbon exploration? A large part of Cuba's oil production + refining is in close proximity to Veradero, a major tourist area. .No problem. No hysteria!.

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concerned799 1 year, 8 months ago

Cuba essentially produces no real amount of oil.

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Voltaire 1 year, 8 months ago

@ColombusPillow - BPC has a subsidiary called Columbus Energy Resources PLC. Funny coincidence hey?

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Bahama7 1 year, 8 months ago

Exactly.

Guyana haven’t had an oil spill in how many drills ??

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Voltaire 1 year, 8 months ago

You are a BPC troll. You are not fooling anybody. You have never commented on this website other than to defend this shameful get-rich-quick plan by a group of foreigners who think we are nothing more than drum beating, grass-skirt wearing 'natives'. You think this won't make it to court? My friend, you have no idea who you are up against now.

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Bahama7 1 year, 8 months ago

" My friend, you have no idea who you are up against now "

and neither do you my friend.

Ha, ha... you hate the fact that Oil & Gas can transform the Caribbean economies. These are the facts - look at Guyana.

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Porcupine 1 year, 8 months ago

Bahama7, sounds like a threat. Be very careful. Clearly you are a paid troll, or just ignorant.

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rodentos 1 year, 8 months ago

last thing Bahamas need is more oil. Invest into renewable technologies, setup a hydrogen plant using solar energy, this kind of stuff.... imagination-less government!

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concerned799 1 year, 8 months ago

If the government can not see the need nor the path to get off fossil fuels with no oil drilling and no LNG and one with a solar future for the Bahamas it should resign. And let it do so forthwith so we can chart a path to a Bahamas and plant which is still habitable.

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alleycat 1 year, 8 months ago

This is taken from the BNT website. Bye bye Cal Sal.

The proposed initial well dubbed Perseverance-1 by BPC is within rowing distance of the Cay Sal Bank, one of the most ecologically productive and economically important marine systems in the country. The Cay Sal Bank Marine Protected Area (MPA) was declared a protected area by pronouncement and by National Gazette in September 2015. The globally significant declaration was in fulfillment of The Bahamas’s commitment to protecting 20% of the near shore marine environment. It was also in fulfilment of inviolate obligations under the Global Environment Facility (GEF) Full Sized project. Cay Sal has thriving marine life inclusive of commercially important species including some of the last remaining viable populations of the queen conch. The importance of the Cay Say Bank for biodiversity and the fishing industry in The Bahamas cannot be overstated. Because of its strategic importance, any pollution of the area would be devastating for The Bahamas and its fishing industry.

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donald 1 year, 8 months ago

It costs approximately $40 to produce a barrel of oil. Oil now sells for $40 per barrel, is now the best time to drill for oil?

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Bahama7 1 year, 8 months ago

It will be $50-$55 next year.

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Porcupine 1 year, 8 months ago

Since you're so good with facts, why don't you cite the number of scientists who say in no uncertain terms that continued burning of fossil fuels is threatening life on this planet. You won't because you don't give a shit about this. You can't, it seems. And, it is clear you don't give a shit about the Bahamas. Get lost and go chase your next get-rich scheme.

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ScubaSteve 1 year, 8 months ago

Nicely said. I agree 110%!! All they care about is $$$.

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Proguing 1 year, 8 months ago

The price of oil will continue to go down due to mass adoption of electric vehicles. Even in the best case scenario that oil is found without any spills, it will be too expansive to get the oil out of the ground.

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Voltaire 1 year, 8 months ago

This is a smash and grab. A get rich quick scheme by shady foreigners. There is nothing in it for us.

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Bahama7 1 year, 8 months ago

Voly - I beg to differ. Oil revenue into the Sovereign Wealth fund can be spent on vital infrastructure. You know this as well as I do. The credit rating of the Bahamas is in steady decline and cost of borrowing is increasing. You need to see the full picture.

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Voltaire 1 year, 8 months ago

Another anti-BPC group is taking up the fight to save The Bahamas. Bahama7, are you going to insult and abuse these young Bahamians too? - https://vimeo.com/480873129">https://vimeo.com/480873129

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