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Audits – buying time

Feb 21, 2025 Editorial, News

Editorial…

Kaieteur News- ExxonMobil has been granted more time to respond to two audits of its expenses.  It would be in Guyana’s interest, if the extra time is used to reveal and not conceal.  Reveal the substance of the audit findings, make a good faith effort to settle the amounts due, and move on.  On the other hand, if all that the company is doing is buying time to conceal its probable shenanigans, then Guyana is in trouble.  The additional time ExxonMobil asked for, and which has been granted, means additional trouble for Guyana.

The first audit was done by the British firm IHS Markit, and was for the period 1999-2017.  IHS Markit’s final report memorialized US$214M in findings.  It was completed in March, 2021.  Next month will make four years since that first audit was completed.  It’s 2025, and ExxonMobil cannot close out whatever it is investigating and reconciling, ending this issue.  It is appreciated that ExxonMobil has other priorities that are bigger than responding to audit findings, such as drilling and upping the number of barrels of oil produced daily in Guyana.  But for audit findings to be hanging unresolved for so long is a little bit too much for Guyanese, even as jaded as they are with what is going on with their wealth.  We thought that we would borrow those three words of ExxonMobil’s Guyana President, Alistair Routledge (“a little bit”) to let he and his superpower company know how all of this registers.  “A little bit” more time to deal with audit findings, and “a bit of” confusion on taxes, was how Routledge soft-pedaled two huge issues here to weave his web of silkiness.

When audit findings can remain open for close to four years, the presiding national government looks poorer for it.  When such a lengthy span of time continues, it spotlights the state of national leaders.  Pitiful and spineless, blindfolded and muzzled, are expressions that best describe their weaknesses, their abject failures in representing Guyana’s interests.  It is helpful to remind Guyanese that the US$214M in audit findings are not without their share of controversy.  Frankly, we think that there was some level of criminality involved, when that same US$214M in findings by IHS Markit was by some wave of a wand transformed into US$3M.  One low-level, inconsequential, and likely innocent Guyanese public servant took the fall.  Whoever was behind him and influenced him to do what he allegedly did with that US$214M reduction to US$3M, that is where the real story is.  That is an audit finding by itself, a political one.  Unsurprisingly, ExxonMobil spoke brightly about the Guyanese public servant who was the willing scapegoat.  Why would it do so, poke its nose into an internal matter, if it was this neutral observer, an unattached participant in how US$214M secretly was remade into US$3M.  This first audit by IHS Markit has moved from a web of silkiness (“a little bit”) to a web of darkness (plea bargaining).  Relative to the latter, it was ExxonMobil giving a testimonial for the public servant said to be responsible for the mystery audit findings reduction.  This oil, from activities dedicated to exploring to how much oil ExxonMobil is really producing daily to the expenses it is claiming to audit findings, is now overrun by a nest of vipers.  The nest has its cohort of locals, it also has its company of foreigners.

The second audit of US$7.3B in ExxonMobil’s expenses for the period 2018-2020, is another tale of delay, questions about quality, and clarity.  The audit contract awarded to the VHE consulting consortium was for an initial period of four months.  It took considerably longer before the final report was handed to the government.  Knowledgeable local observers have questioned the quality of the audit work done, in which tens of millions in US dollars were flagged.  The second audit report was handed to ExxonMobil in November 2024.  Pursuant to the 2016 Production Sharing Agreement, the company has 60 days to respond.  The latest is that the company has been granted additional time.  Companies like to drag their feet with audit findings to fix their defenses.  ExxonMobil has manifested the usual awkward sloth.  We wonder for what purpose.

(Audits – buying time)

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