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US$214M questionable Exxon bills stand and not US$3M breakdown by Ministry
…Claim will be settled via arbitration – VP Jagdeo
By Kiana Wilburg
Kaieteur News – Vice President, Dr. Bharrat Jagdeo on Thursday confirmed that the government unequivocally supports the Guyana Revenue Authority’s (GRA) identification of US$214M in questionable expenses racked up by ExxonMobil for the Stabroek Block.
Vice President, Dr. Bharrat Jagdeo
He also rejected the subsequent breakdown of the sum to US$3M by the Ministry of Natural Resources’ Petroleum Unit, adding that it was disappointing and should not have occurred.
During a press conference at Freedom House, Kaieteur News sought clarity on the matter after the questionable costs saw a significant reduction. The US$214M figure was first flagged by British Consultancy Group, IHS Markit following its audit of US$1.6B in expenses by Exxon from 1999 to 2017 in the Stabroek Block. GRA, which is tasked with ensuring the nation’s interests are protected on these matters, subsequently gave its no-objection to the sum. Despite doing so those costs were subsequently reduced to US$11M and then US$3M without GRA’s knowledge.
In response to this newspaper’s queries, Jagdeo said the breakdown of the sum should not have occurred in the first place and expressed disappointment that the ministry even engaged Exxon in this regard.
The Vice President said, “This matter should have been closed earlier. I thought GRA was dealing with this matter totally because that is what we said… that GRA should deal with the issue of the audit. They should have a final say at the technical level. I was reluctant to even speak about it because I said it is being handled technically.”
The official said he later discovered that GRA wrote the ministry and said twice that given the passage of time, the audit should close with US$214M as the final amount of disputed costs. But this he said did not occur.
Jagdeo said the Natural Resources Ministry then engaged Exxon in a discussion after GRA recommended closing the audit.
GRA Commissioner General, Godfrey Statia
“But that should not have happened. I am told there was no great discussion. Exxon only sent in some proposals but they shouldn’t have even entertained that. So my position still stands, I will go with what GRA has. I told [GRA Commissioner General, Godfrey] Statia you will deal with it directly and not the ministry any longer,” the Vice President said.
He added, “I am very disappointed because we said all along we must be guided by the technical people…”
The Vice President said clearly that there is a disagreement on the costs and now the next step is arbitration.
The audit of US$1.7B in Exxon’s expenses for the oil-rich Stabroek Block has taken more than three years to be completed. Government has assured that once the exercise is finished, a report would be made public.
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