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Exxon admits to grabbing Guyana’s oil profits to pay for gas pipeline
…company previously said country will buy gas to pay back cost
(Kaieteur News) – ExxonMobil Guyana Limited (EMGL) on Tuesday admitted to using Guyana’s oil to pay for the dormant pipeline built to transport gas from the Liza Fields offshore to Wales, West Bank Demerara where government is hoping to generate 300-megawatts of electricity in the future.
The oil giant previously informed the nation that Guyana would purchase gas over a 20-year period to repay the cost associated with developing the structure. This explanation was also provided by the Head of the Gas-to-Energy (GTE) Taskforce, Winston Brassington.
The 12-inch diameter gas pipeline laid by ExxonMobil
Vice President and Business Services Manager, John Colling however confirmed information received and reported on by this newspaper, from credible sources regarding the payment arrangement for the pipeline.
This newspaper was informed that the country has already commenced payment for the pipeline, using the country’s oil, although the structure is not in use. Notably, President of EMGL Alistair Routledge previously assured that repayment would commence only when the pipeline becomes operational. The cat was however let out of the bag when the VP was asked to explain whether Guyana’s oil is paying for the structure.
He said, “Yes. We’ve mentioned this before, the pipeline was charged to the cost bank.”
EMGL Vice President and Business Services Manager, John Colling
When reminded that Guyanese were previously told of a 20-year gas purchase agreement to repay the pipeline costs, Colling said the terms of the agreement with government specifically state that those costs were recoverable.
“If we look at the commercial terms of the pipeline, I’m not necessarily going to get into a lot of detail, but effectively those costs are recovered by ExxonMobil Guyana Limited through cost recovery,” the Vice President stated.
In response to a question on when repayment started, he explained, “As I mentioned, those costs were included in the cost bank and are currently to be recovered as part of normal cost recovery.”
Colling noted that the structure appears under “wells and facilities” in its financial statements presented.
Guyanese continue to be fed with partial bits of information and are often misled by officials assigned to govern the nation’s largest financial project on record.
Despite repeated calls for transparency, government continues to hide the contracts it signed with Exxon for the GTE development. The administration has refused to publish the agreements inked with the energy giant although it lambasted the former government for hiding the 2016 oil contract with the company, that was eventually made public.
Kaieteur News has been reliably informed that the government of Guyana has agreed to purchase the gas discovered offshore in the Stabroek Block from Exxon. While critics condemned the administration for agreeing to pay the company for Guyana’s natural resources, Vice President Bharrat Jagdeo previously told Kaieteur News that no such agreement has been made.
“No, the gas to the power plant is free. You can quote me on that. Gas to the power plant is free. We negotiated that a long time. We’ve been in the public domain as saying that the gas to come in – the 50 million cubic feet per day coming in to the power plant – is free. Nothing has changed since,” Jagdeo told this publication last month.
While government defends its position, it has not made the contract with the company public to offer citizens further assurance.
Following a report indicating that Guyana has signed an agreement with ExxonMobil to purchase its own gas from the Stabroek Block, former Finance Minister, Winston Jordan called on the government to publish concrete evidence to support its claims.
“We have not seen a single document in relation to this project and so we keep speculating and they can end all the speculation by putting the document in the public domain or come out and refute with evidence what we have said. You have to show the evidence that this is not so and they can withhold whatever proprietary information from the contracts,” he said.
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One thought on “Exxon admits to grabbing Guyana’s oil profits to pay for gas pipeline”
Blunt of the day
Sports
Features/Columnists
Sir. Ronald Sanders
The GHK Lall Column
Weekend Cartoon
Everyday, the tune is different. Then, who wants to listen to the same tune
all the time.
Irfan Ali, and Jagdeo are not to be believed going forward without the
contract in question, published for citizens to read themselves.
Old Western (cowboy) movies, the Indians say WHITE MAN SPEAK WITH
FORKED TONGUE.
NOW, JAGDEO HAS JOINED THE WHITE GROUP. ANYTHING HE SAYS
MUST NOT BE BELIEVED AT ALL. SAME FOR ALI TOO.