The Tribune

* Oil explorer says activists exposed 'true agenda'

* BPC confident 'no legal impediment' to plans

* Activists confident in 'powerful' legal case

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Activists yesterday argued The Bahamas is "paying lip service to the green and blue economy" in response to charges they have exposed their "true agenda" by seeking to block oil exploration.

Bahamas Petroleum Company (BPC), firing back at the Judicial Review challenge initiated by Waterkeepers Bahamas and the Coalition to Protect Clifton Bay, sought to reassure shareholders that its first well will move ahead as planned by asserting "there should be no legal impediment" to its plans.

Simon Potter, BPC's chief executive, in a statement to the stock market argued that the environmental activists had shown their "true agenda" by waiting until the last-minute - just one week before the Stena IceMAX drill ship arrives in The Bahamas - to seek to halt the Perseverance One well.

Arguing that the Judicial Review could have been brought at any time since late February, when BPC publicly announced it had received the necessary Environmental Authorisation (EA), Mr Potter said the timing showed its opponents were simply aiming to inflict maximum financial harm and "simply disrupt and stop our lawful activity".

Disclosing that the Government also plans to oppose the action, Mr Potter said: "Yesterday's application for a Judicial Review, an extension of time and a stay from a group of environmental activists is entirely without merit. BPC will vigorously oppose the application, and we understand that the Government of The Bahamas will be doing likewise.

"BPC's drilling plans have been public knowledge for almost a decade, and the Government provided Environmental Authorisation (EA) to BPC in February 2020, following an extensive programme of work.

"Environmental activists could have sought to bring this application at any time. That they have waited until now, on the cusp of drilling, speaks to their true agenda, which is not any real concern for judicial process but simply to disrupt and stop our lawful activity."

BPC's goal is for the Stena IceMAX to begin drilling Perseverance One in waters some 90 miles west of Andros, close to the maritime boundary with Cuba, on December 20. The entire exercise is expected to take between 45-60 days, and the oil explorer has repeatedly argued that - as a non-production well - the chances of any oil spill will be minimal and it will be capped afterwards.

Mr Potter yesterday again argued that The Bahamas now, more than ever, needed to determine whether it possesses a natural resource that could potentially act as a game changer for both the economy and government's finances post-COVID-19 if commercial quantities are discovered.

"The Government of The Bahamas is exercising its legitimate, sovereign right to establish if the nation of The Bahamas has its own commercial hydrocarbon resource," the BPC chief said.

"With the islands facing economic fragility, suffering from both hurricane damage and the impacts of COVID-19, a successful petroleum discovery has the potential to rebase the economy, generate billions in revenues over the life of the project and create new contracts and jobs. No oil will be produced by Perseverance One as it is purely a fact-finding exercise of short duration.

"The people of The Bahamas have a right to know if this resource is there for them and for future generations of Bahamians. In the past ten years, many thousands of offshore oil wells have been drilled safely and without incident all around the world, and many other nations in the region such as the US, Mexico, Trinidad and Tobago, Suriname and Guyana have over the past decades safely and responsibly drilled offshore wells, developed or continue to develop offshore hydrocarbon resources, and reaped the economic benefits of an established or a whole new industry. Moreover, these other nations have been able to do so at the same time as seeing growth and development of existing industry sectors, such as tourism."

Mr Potter has previously said that The Bahamas could earn up to $5bn in royalties over the 10-20 year lifetime of a commercial project, adding that this will not be impacted by volatility in global oil prices.

However, many Bahamians are sceptical, believing that the 50/50 revenue split with the Government would only be achieved at the $80 per barrel price BPC used to illustrate this. With production costs at $40 per barrel, they feel the financial benefits for the country would be minimal at prevailing market prices.

"BPC intends to apply to the court to be heard as a person affected and to oppose the application," the company added yesterday of the Judicial Review. "Given that BPC's drilling operations are scheduled to commence before the end of 2020, BPC anticipates that the application for a stay will be determined definitively by the Court on an expedited basis, prior to drilling operations commencing.

"BPC believes the application to be without legal basis or merit, and considers that there should be no legal impediment to proceeding with the drilling of the Perseverance One well."

Mr Potter, meanwhile, concluded: ""The Government of The Bahamas is to be commended for the thorough, comprehensive process of review and scrutiny they put BPC through over nearly a decade around the Environmental Authorisation process for the drilling of the well, as well as for the Petroleum Act and Petroleum Operations-related regulations, which were passed into law in 2016.

"In gaining its Environmental Authorisation, BPC adhered to all applicable Bahamian laws, and over and above this adhered to all applicable guidelines, international standards and best practices. We look forward to proceeding with Perseverance One on schedule, and fulfilling our licence commitments to the Government of The Bahamas."

Fred Smith QC, the Callenders & Co QC representing the activists, yesterday fired back at BPC by arguing that his clients "have a powerful case on the merits" while questioning whether the oil explorer has all the necessary permits to proceed.

"The application for Judicial Review very clearly explains the abysmal failure of BPC to get the required statutory permits post-licence," he told Tribune Business. "As with Heads of Agreements, just because you get the overarching blessing of the National Economic Council (NEC), Office of the Prime Minister, Bahamas Investment Authority (BIA) or whatever surreal acronyms the Government of The Bahamas can create does not mean you do not have to obtain the necessary permits which Parliament, speaking on behalf of its citizens, requires you to get.

"Even if you have a licence to explore you still have to get site plan approval under the Planning and Subdivisions Act, you still have to get an excavation permit under the Conservation and Protection of the Physical Landscape of The Bahamas Act, and you still have to satisfy the Bahamas Maritime Authority (BMA) you are not going to dispose of grey water within the archipelagic baseline.

"Getting a licence is not a get out of jail free card. I challenge BPC and the Government to provide the relevant permits and licences that are required by the Parliament of The Bahamas. BPC and the Office of the Prime Minister do not have licence to ignore the laws passed by Parliament."

Noting that the Prime Minister has repeatedly promised to respect the rule of law, Mr Smith added: "The Government of The Bahamas and my Prime Minister continues to speak about climate change and small island nations. We are among the most vulnerable in the world.

"We cannot have lip service being paid to a green and blue economy and, at the same time, hypocritically engage and promote offshore oil drilling." He also described BPC's allegations about disrespect for the judicial process as "misconceived", adding that it should have "pressed the pause button" on sending the Stena IceMAX to The Bahamas following his warning legal action was imminent.

"I have invited the Government to proceed very quickly and urgently with the litigation because we are confident that we have a powerful case on the merits. Let the courts decide. The rule of law in The Bahamas reigns supreme," Mr Smith said.