As Mercopress reported, Premier Oil are currently consulting on the Environmental Impact Statement (EIS) for their Sealion Oil Field development sitting 220km to the North of the Falkland Islands in 450 metres of water depth. The formal minimum 42 day consultation period began earlier in the week and only after the Falkland Islands Government agreed via its Executive Council that it could do so.
In relation to that Executive Council approval, Member of the Legislative Assembly, Hon. Teslyn Barkman said that the EIS “is a substantive document” which was only published by the Government after having sought “independent review”. She went on to say that the document as it stands “complies with the required Falkland Islands legislation”.
However, the paper to Executive Council fully expects a range of responses during the consultation phase. When consultation is complete the EIS will be adapted accordingly and a summary of all the comments and Premier’s responses will be re-submitted to the Government. Premier Oil will then ultimately ask for final approval of the EIS. This can then be accepted by the Government or perhaps, if they are unconvinced, it can go back out for further consultation.
This process is expected to take a number of months and will form one key element of Premier Oils overarching approvals process to commence development of the field. It has been reported that Premier Oil are looking to finish this approvals process this year, however there has been considerable delay against targets previously.
The EIS follows practice from elsewhere in the world, particularly benchmarks established in the UK North Sea (on which much of the Falkland Islands existing oil-related legislation is based). The consultation within the Islands is expected to highlight any remaining areas of concern from both residents and NGOs. Experience from previous oil exploration phases in Falkland Island waters suggests that there is likely to be a relatively small number of highly detailed responses to the EIS. These will likely come from a combination of local residents, industry groups, Falkland Islands NGOs and some international environmental NGOs also.
One area of contention is likely to be the proposal by Premier Oil to pay $200,000-$250,000 per annum into an Environmental Fund for environmental projects in the Islands. There had been considerable discussion over the past two years, particularly pushed by local Environmental NGO Falklands Conservation, for Premier Oil to establish such an environmental fund to support local projects. The dollar figure associated with this fund annually was not broadly discussed and is likely to attract feedback during the consultation. When approving the EIS for public consultation the Falkland Islands Government merely noted the figure and did not appear to take a view on its value at this stage.
The second major area of discussion is likely to focus on Premier’s estimates around and planned response to any oil spill scenario. Planning for unlikely but potentially catastrophic oil spill events is a normal part of such a process and understandably draws much attention. The paper submitted to Executive Council stated that the Government had already been working alongside external advisors over the past 12 months to agree such scenarios with Premier Oil who had done additional modelling as part of this process.
Finally, there is also likely to be consultation feedback on Premier’s plans for decommissioning of the field at the end of its useful life (expected to be 15-20 years after first oil). The detail of decommissioning will be the subject of a separate EIS in the future, however the current version does outline the expectation that Premier will remove all structures relating to the field during decommissioning.