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If Govt. was serious, it would have unleashed an army of forensic auditors behind Exxon – Former Finance Minister
US$750K contract to audit Exxon US$9B bills …
Kaieteur News – Notwithstanding the barrage criticisms against the flawed 2016 Stabroek Block Production Sharing Agreement (PSA), Guyana still needs to take an eagle’s eye approach to the multibillion dollar bills being racked up by ExxonMobil and its partners says former Finance Minister, Winston Jordan.
Former Finance Minister, Winston Jordan
In an exclusive interview with Kaieteur News, Jordan said the monitoring of the costs being recovered by ExxonMobil’s affiliate and operator of the Stabroek Block, Esso Exploration and Production Guyana Limited (EEPGL), is one of the key ways Guyana can prevent revenue leakage and wanton abuse. He said too that it is a sure way of maximizing returns to the country.
The economist said, “We have to engage in real time auditing. We can ill-afford to be doing ex-post audit. An audit is like a post mortem, it can’t bring back dead. When there is a dispute of figures, Exxon can tie you up for donkey years in court but they have already collected the sum in contention. They have already billed you; mind you, nothing is being trashed out in our courts. It will be in their backyard.”
The former Finance Minister also provided a glimpse into some of the previous dealings the APNU+AFC coalition had with Exxon on accounting matters. Readers would recall that when former President, David Granger created the Quintet plus One ( a Cabinet sub-committee to address matters in the oil sector), it included Jordan; former Minister of State, Joseph Harmon; former Minister of Public Infrastructure, David Patterson; former Minister of Natural Resources, Raphael Trotman; former Business Minister, Dominic Gaskin, and former Advisor to the President on Petroleum, Dr. Jan Mangal.
Jordan said, “Even when we had the Quintet plus One, we had difficulty with the way how Exxon used to be presenting their tables, graphs and so on and they told us that this is how their accounting system works. It was evident that you could not tell Exxon how to prepare their accounts and in what format…So you need a level of forensic investigation to be unleashed on the bills being presented by this company. Guyana needs people who know their onions in the oil industry.”
The former Finance Minister said he was hopeful that there would have been a coalition of forensic auditors from accounting majors going behind Exxon and working in the interest of the State. “I know it would cost us a fair bit but the knowledge we would have gained in partnering them with a local firm, it would have been second to none. In checking US$9B plus expenditure from Exxon, I don’t believe a US$750,000 contract can really give us the forensic investigation that we need. You cannot make a genuine leather watch for US$5,” expressed the economist.
Kaieteur News previously reported that a US$751,000 (GY$157,165,299) contract was awarded to Ramdihal & Haynes Inc., Eclisar Financial, and Vitality Accounting & Consultancy Inc. to audit over US$9B in expenses by Exxon. The local consortium will be supported by international firms–SGS and Martindale Consultants. The task is expected to be completed in September.
Jordan also bemoaned the fact that Guyana continues to see more bills being racked up by Exxon and its partners, Hess Corporation and CNOOC Petroleum Limited, meanwhile, the country continues to have no say.
He referenced in this regard, the US$1.75B loan that was taken by Dutch manufacturer, SBM Offshore to build the “One Guyana” Floating, Production, Storage and Offloading (FPSO) vessel which will serve the Yellowtail project in the Stabroek Block.
Jordan said, “Now that is a bill they will throw to us. But yet, Guyana has no one tracking that expenditure and no one that was involved in the putting together of the financing. Massive bills are just being thrown at us and we have no clue how Exxon is accounting for it from our oil. It is for this reason, I said we should not be bouncing around with excitement when we hear discoveries because the bulk of it does not belong to us, it belongs to Exxon.”
Before Guyana gets a drop of her own oil, he reminded that Exxon gets to use significant portions to run its operations as well as for transportation purposes for free. Reports on the quantity of oil used in this regard have not been released since the PPP/C Government assumed office. This is in spite of promises by Vice President, Dr. Bharrat Jagdeo that this would be done in the interest or transparency and accountability.
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