Stretching costs to make them recoverable

May 31, 2024 Editorial

Kaieteur News – ExxonMobil interprets recoverable costs anyhow it wants, selects any expense that attracts its interest, then dumps that on Guyana to pay. The 2016 Production Sharing Agreement (PSA) lists in Annex C those costs that can be recovered from local oil revenues. ExxonMobil has evidenced that it does not care to limit itself to those identified recoverable costs. Whatever appeals to its greed is bundled together for approval to deduct from oil revenues, which means lower profits for Guyana.

The schemes that this oil company partner of ours came up with are mindboggling. General business that has nothing to do with oil exploration, development or production finds expenses related to it hung around Guyana’s neck. One of the findings of the auditors was that the expenses related to the establishment and operation of the Enterprise Development Center had no place under exploration for, and development and production of oil.

There is no way that an oil company with the century plus years of global experience of ExxonMobil does not fully know by now what is a legitimate expense under its own engineered and lopsided Guyana PSA. Still, the self-enrichers of ExxonMobil cannot help themselves, so they push the envelope with one ineligible expense after another. The oil super knows this is wrong, but still tries its hand, so to speak, to see how much it can succeed. It has a pushover government in its fists, and leaders who push themselves with sickly energy to get out of ExxonMobil’s way. Oil associated expenses are just one instance where the company is the worst possible partner that this country could have found and made a pact.

In a parallel finding, the VHE Consulting team of auditors denied the expenses for the Greater Guyana Initiative that was launched by ExxonMobil in 2021 to support another local entity that could not be linked to oil operation. We at this paper would argue that there is every indication that instead of ExxonMobil devoting a comprehensive interest in how to partner honestly and openly with Guyana, it is going in the opposite direction. Rather than finding ways to be the best partner for Guyana, ExxonMobil is actively engaged in how to prey upon it and gorge itself sick on this country’s oil money. Like the Midas of legend and his insatiable greed for gold, ExxonMobil could end up with a statue of stone and steel and not an overloaded bank vault for all its slick efforts. Constant plotting on how to fuse offshore and onshore expenses could backfire. There is a lesson in recalling what the caring father did to his own daughter.

At different times, we have exposed the expenses that the company has billed Guyana for and wonder where these exercises in corporate excesses stop. When it hasn’t been bills for Christmas parties, it has been for getting and keeping fit. ExxonMobil is training its people to be in tiptop condition, so that they can develop new ideas and ways to charge Guyana’s oil revenues for any and every expense. If, according to ExxonMobil, helping locals with catering and the like can fall into the pool of eligible expenses, then it is reasonable to make the case that the expenses related to maintaining this daily publication is also related to offshore oil operations.

What is interesting is that the more that the auditors affirm about what expenses are ineligible and, therefore, do not pass muster for deduction from local oil revenues, the more ExxonMobil does not agree, puts up a wall of resistance, and drags out findings for years. Compared to this country, the company has all the advantages on its side. It has the skills and capacity; we have little of either. It has time to play time consuming games, Guyana needs these findings to be resolved now than next year or the one following. It has energy in abundance, while Guyana is panting for breath and falling farther behind in the face of these corporate tricks. The audits have identified a culture of the company: whether the expenses are big or little, stick them to Guyana. Regardless of if they are eligible or not, still push them forward. This is Guyana’s oil partner.

attracts, dumps, Editorial, Production Sharing Agreement (PSA), revenues

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