ExxonMobil has been accused by watchdog group, Global Witness of aggressively pursuing purchase of an offshore Liberian oil block in 2013 despite its awareness that it was tainted by corruption.
The anti-corruption watchdog said that to get around US laws which may have frowned on the purchase, ExxonMobil used a go-between Canadian company to make the initial purchase of the block before securing it for itself.
The report issued this month by Global Witness will underline concerns here about the lack of transparency in the Guyana Government’s dealings with ExxonMobil – particularly the secret conclusion of a heavily criticised Production Sharing Agreement and the receipt of a US$18m signing bonus which was hidden from the public.
Bought during the tenure of then Chief Executive Officer and former US Secretary of State, Rex Tillerson, Global Witness said ExxonMobil paid no heed to information on corruption it had on how the company was formed and was singularly focused on acquiring it.
Global Witness stated that it has an internal document in which ExxonMobil says it is interested in the oil field but has “concern over issues regarding U.S. anti-corruption laws… despite its concerns, Exxon went ahead with the deal, using the Calgary-based company Canadian Overseas Petroleum (COPL) as a go-between to purchase the block.”
ExxonMobil knew too, GW says, that the purchase might enrich former Liberian politicians who were likely behind the block and structured the deal in a way it hoped would bypass US anti-corruption laws. The company also knew that Liberia’s oil agency had previously bribed officials to approve oil deals, including the very block it wanted to buy, the organization posits.
“This is a story of bribery, suspected secret shareholders, and an audacious attempt by oil giant Exxon to bypass US anti-corruption laws. It is a story of how the American company – headed by Rex Tillerson – appears to have turned a blind eye to earlier corruption when buying an oil license in the impoverished West African country of Liberia. Finally, this is a story of how the US can help end corruption by requiring that oil companies report in detail what they pay to governments,” the 40 page Global Witness’ Report, released yesterday and named ‘Catch me if you can’, states.
And in the contract ExxonMobil and COPL signed with the government of Liberia, the companies requested that the Liberian government agree that “past irregularities will not affect [the contract] or its new owners”.
The purchase of the oil block licence in 2013, Global Witness says likely enriched former Liberian government officials who may have illegally owned the block.
According to the advocacy group, Liberia’s state oil agency NOCAL also made unusual, large payments to senior government officials who authorized the 2013 deal.
“Block 13 was originally awarded by NOCAL in 2005 to Liberian-Anglo company Broadway Consolidated/Peppercoast (BCP). In 2007, the block was ratified by the Liberian legislature through bribery. But Global Witness’ evidence shows that the company was likely part-owned by former Mining Minister Jonathan Mason and former Deputy Minister Mulbah Willie. Mason and Willie are suspected of granting the oil block to a company in which they held interests while they were also ministers in 2005, which was illegal under Liberian law. Exxon knew that Block 13 was originally awarded through bribery and that its purchase of the oil block could enrich former officials who might have been behind BCP,” the global non -profit organization states on its website.
“In a PowerPoint presentation obtained by Global Witness, Exxon wrote that it was interested in purchasing the oil block despite its “concern over issues regarding US anti-corruption laws.”
Highlighted in the document also was the fact that Exxon’s purchase in 2013 was also accompanied by over US$200,000 in unusual, large payments made by the corruption-tainted Liberian oil agency to six Liberian officials who approved the deal.
“Officials who received payments include Liberia’s then-Justice, Finance and Mining Ministers, each of whom received (US)$35,000 – more than doubling their annual salaries. The officials receiving the unusual payments and the posts they filled at the time were: Finance Minister Amara Konneh, Justice Minister Christiana Tah, Mining Minister Patrick Sendolo, National Investment Chairman Natty Davis, NOCAL CEO Randolph McClain,” GW says. It said that NOCAL’s Board Chair Robert Sirleaf who is the son of then-President Ellen Johnson Sirleaf, was reportedly working pro-bono at the time.
“Three officials who received payments – Davis, Sirleaf and Tah – have stated that they were “bonuses,” authorized by NOCAL’s Board of Directors for negotiating a good deal with Exxon. Details of these responses can be found in Global Witness’ report. There is no evidence that Exxon knew about these payments, but they were likely made from the same oil agency account into which Exxon had just deposited (US) $5 million,” it added.
It is against that background that Global Witness called on the Liberian Government to investigate those involved in Exxon’s 2013 oil deal for corruption or wrongdoing.
“Exxon, Broadway Consolidated/ Peppercoast, and those who received the unusual, large payments should be investigated to determine if they broke laws in the US and Liberia,” GW urged.
It quotes a senior anti- corruption campaigner at GW, Johnathan Grant saying that “It’s appalling that an oil giant like Exxon would buy up an oil block they knew was tainted by corruption…this kind of morally dubious corporate behavior is particularly shocking in a country like Liberia where endemic corruption continues to rob people of opportunities.”
But Global Witness wants the world to know that their extensive research and report is not “just a story about Exxon and Liberia”.
“ It’s also about how Exxon – along with others in the oil industry – has repeatedly attacked the US anti-corruption and oil transparency law that makes it possible for us to uncover deals done in this notoriously corrupt and opaque oil and gas sector”, GW says.