Glenn tells VP Jagdeo: ‘Monitor Exxon expenses, come clean on Guyana’s real profit from Stabroek Block’

Dec 19, 2022 News

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Kaieteur News – With Vice President (VP), Bharrat Jagdeo throwing his support behind, ExxonMobil’s claim that Guyana was getting 52% profit from the oil resources in the Stabroek Block, Kaieteur News Publisher, Glenn Lall, said this assertion could not be further from the truth. He also said that as head of the petroleum sector here, Jagdeo should do more to monitor the expenses of ExxonMobil, which the company recoups based on the lopsided Production Sharing Agreement.

Speaking on his final radio programme for the year, Lall told his audience, “As of now I could be definitive to tell all Guyana, that the 52% they say Guyana getting is false, its misleading, is inaccurate, is deceptive – no matter how many billboards they put up in this country and how much Jagdeo dance on his head – the bottom line is that Guyana is not receiving 52% as set out in the ExxonMobil contract, and that I can prove beyond the shadow of a doubt”

The issue came to the fore some two Fridays ago at a News Conference hosted by Jagdeo, an Economist, after he was asked to weigh in on the issue with reference to billboards erected by ExxonMobil advancing the 52% profit claim.

The VP explained, “I saw how they are claiming the 52 (percent) – 50 percent from profit oil and then 52. That might not be the most egregious thing because it is accurate- that 52 percent. If you look at how it’s calculated, so its 50 percent of the profits.”

VP Jagdeo was reminded that 75 percent of the revenue is first deducted to cover the Operator’s expense, in keeping with the lopsided Stabroek Block, Production Sharing Agreement (PSA), and was asked to explain how this calculation would be accurate. After pausing, he then responded, “If you look at the lifecycle, normally you look at the lifecycle of the project. It can’t be done simply. So if you look at the lifecycle at 50- we had the simulations done- of $50, $60 and $100. So this is, here if this is $100, it works out to about 49 to 50 percent. If its $50 over the lifecycle of the project, it’s close to 50 something percent, 56 percent.”

Highlighting and stressing Guyana’s share, Jagdeo said factors such as the number of production years and number of barrels produced, must be considered and then multiplied by the price per barrel at $50. As such he said, “No, I don’t think that is misleading, there might be other things I do not agree with but I don’t think that’s misleading.”

But Lall who first called out ExxonMobil on the billboards, said when he listened to the Vice President, he became confused. “This is not accidental what is happening here, this is part of a scheme going on, the sell-out of this country’s wealth. How on God’s earth Jagdeo can’t tell this country what amount of money we have to get on a daily basis, when the contract spell it out clear. The contract says 2% Royalty, and 50% profit after 75% of the total revenue is taken out as oil expenses. How come this VP can’t tell us precisely and with authority what is Guyana’s total take in this oil business we have. If a Leader can’t tell us exactly how much money you must get as a country, as your share, then what else this man can’t tell us.

“Uncle, you tell me, I begging you, you tell me, if you nah know the exact amount of money you getting from your coconut farm or your rice field or your mango farm, then what business you really running? Is better you tell the people to come tek the thing and go along their way. This man going round in circles, round and round, like a belly dancer to spin we head, making us fools,” Lall further said.

Publisher of Kaieteur News, Glenn Lall, also said the reason why Jagdeo has not been definitive on the matter is because ExxobnMobil is recovering the royalties paid to Guyana, and that the 50% profit share they said Guyana was receiving was not true.

“…so the billboard is totally false, incorrect and Jagdeo of all persons with all his financial gurus at his side, Ashini Singh and others, know that Guyana is being robbed, this is why he cannot come out clear and tell this nation, well listen Guyana, this is what you are getting out of your oil,” a perturbed Lall added.

Richest country per citizen
Meanwhile, Lall said the oil discovered in the Stabroek Block has made Guyana the richest country per citizen in the world, noting that at the moment Guyana is the fastest growing economy on earth with the biggest GDP. “Guyana is now the talk in the whole world… but when it comes to our Politicians you believe that some cat carry way their tongues.” Lall said for this Christmas many citizens are finding it difficult to go in the market to buy groceries due to skyrocketing cost of living. To this end he called on citizens to stand up for their rights. Drawing reference to last week’s protest for City Mayor, Ubraj Narine, Lall said he was heartened by the large turnout. However, he urged that citizens to be similarly enthused to fight for a better oil deal and get our Leaders to bring ExxonMobil back to the negotiation table.

Expenses
Touching on the issue of recoverable expenses as per the oil contract between Guyana and ExxobnMobil, Glenn Lall said at the recent News Conference, Jagdeo was also asked who is monitoring and authorising the expenses being incurred by the oil company and according to him Jagdeo asserted that Guyana is blinded by the lack of a ‘co-management arrangement’, which prevents it from knowing on a timely basis what costs are accumulated by ExxonMobil.

“This oil company is taking us for a ride by cheating us with inflated bills. Section 7.1 of the 2016 Contract states: “The Contractor shall prepare with respect to each Calendar Quarter, or on a monthly basis if requested by the Minister in writing, a Statement of Expenditure and Receipts under the Agreement.” There is no debating of Section 7.1, because the facility for co-management is written there in stone, and painted in black and white. We are surprised that Dr. Jagdeo missed that, and we hope that it was not deliberate. Moreover, we are surprised that the Minister of Natural Resources has not taken the fullest advantage of Section 7.1 of the contract by demanding those bills. This would effectively put this country in the position of confidently watching out for its own interests, while keeping a watchful eye on those it does this oil business with, meaning ExxonMobil and its partners, be they in the form of suppliers, vendors, and sub-Contractors. Just recently, there was the warning to Guyana to be on the lookout for ‘shell companies’ which could be used by ExxonMobil to pay itself from this country’s ignorance or negligence”, Lall said.

“The Vice President is studiously trying to avoid holding ExxonMobil accountable. He said the contract provides for monitoring, but the Government is refusing to do so.Who does not want to be part of, or have a say in a business in which they got to get ½ of the profit, you guys know of anybody?,” asked Lall. “ Even if you and a man mining 1,000 chickens to spilt the profit ½ and ½, don’t you have to know the price your partner paying for the chicken feed…?” said Lall.

Nothing Jagdeo’s indifference to monitoring the expenses of the oil companies, is almost criminal Lall continued by saying, “Imagine this man running our oil sector out there, not checking the projects worth billions of US Dollars, not approving any of the USMD contracts ExxonMobil giving out, just allowing ExxonMobil to deduct whatever they have to deduct and give Guyana whatever they feel like giving Guyana. That is the 50/50 partnership Guyana got with ExxonMobil out there, according to Jagdeo.”

Highlighting further the seriousness of the matter, Lall added, “The contract say we are to get 50% profit out of the entire business every day and we have a right to know the entire cost of operating the business out there – that is how business is run Jagdeo. We are not just a partner that will sit down and accept whatever is thrown at us, no sir, that’s not how a business is run, each partner must have a say in every cent spent and earned.

“Where is the Private Sector Commission, the Georgetown Chamber of Commerce and Industry, the business community out there, as to what this man is telling Guyana?,” Lall further questioned.

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