While Vice President, Dr. Bharrat Jagdeo previously said the first audit into ExxonMobil’s pre-contract costs totalling US$1.7B is closed with US$214M as the disputed sum, ExxonMobil Guyana Limited confirmed that the process is ongoing. Specifically, ExxonMobil Guyana’s President, Alistair Routledge disclosed that his company received a letter from the Guyana Revenue Authority (GRA), last week, stating that it still has an opportunity to furnish authorities with records to support the queried expenditure.
If it fails to do so, Guyana and the oil giant will go head to head in arbitration to prove that the disputed sums must be returned to the cost bank and shared equally between the company and State.
During a press conference at the company’s Duke Street Office, the audit, which remains shrouded in controversy, was the first matter to be addressed by Routledge.
Guyana Standard readers would recall that the audit, first done by British firm, IHS Markit in 2019, flagged over US$214M in questionable spending incurred from 1999 to 2019. The Ministry of Natural Resources, which was overseeing the audit process, fell into hot water after its Senior Petroleum Coordinator, Bobby Gossai, engaged Exxon in the unauthorized reduction of the US$214M sum to US$3M.
Gossai is expected to face disciplinary action for what the ministry said is a deviation from the GRA’s advice to close the audit at US$214M. Interestingly, GRA is now allowing Exxon to do exactly what Gossai faced public humiliation for.
Calls to Vice President, Dr. Bharrat Jagdeo and GRA Commissioner General, Godfrey Statia to understand why Gossai faced public ridicule for a course of action the authorities are pursuing, went unanswered.
In the meantime, Routledge defended his company today, noting that it is not abnormal to see minimal sums being flagged during an audit of its expenses. He also noted that the company subjects its expenses to “four sets of eyes.”
“…We are audited by our co-venturers who have just as much interest as the government in ensuring all the costs that go into cost recovery pool are appropriate and are in line with the standards you would expect,” Routledge said to a room of 12 journalists.
The Exxon Head also said that his company is much more supportive of regular and timely auditing by countries, alluding that the IHS audit which started in 2019, continues to move at a snail’s pace. He did acknowledge that the audit is examining over 20 years of expenses, hence, it will take time for the company to dive into its archives and find records in a timely manner for auditors.
Thus far, the Exxon Guyana Head said his company has secured documentation for more than 90 percent of the US$214M queried cost. “…It’s to now work to find the documents for that small amount,” he said.
ExxonMobil Guyana leads a consortium with Hess Corporation and CNOOC Petroleum Guyana Limited in the Stabroek Block where 11 billion barrels have been unlocked via more than 32 significant discoveries.
The Exxon partners have committed to spending more than US$40B in five development projects, a staggering investment scale that eclipses Guyana’s 2023 national budget by more than 10 times.
