The Alliance For Change (AFC) has flayed the PPP/C government over its handling of the auditing of US$9.5b in oil costs and has asked whether ExxonMobil has acquiesced to the scrutiny of the figure.
Earlier this month, the government conceded that the statutory period for the auditing of the expenses had expired and said it had not been able to find local firms to examine the expenses. The default by the government triggered a public outcry and 16 days later President Irfaan Ali signalled a reversal in position when he said that the auditing will be done. He is still to say whether ExxonMobil has given its agreement for the auditing.
In statements at a press conference it held on Tuesday, the AFC accused the government of “negligence” in letting the deadline for the auditing expire.
“The Government’s pretext to cover up this most callous act against its people, is that Guyana does not have the expertise to conduct such an audit – a highly incredulous excuse based upon the fact that the AFC is well aware of a highly qualified firm owned by a Guyanese in the Diaspora that submitted a bid to conduct the audit. Is the Government speaking with forked tongues when it extols itself as so badly wanting the help of the Guyanese Diaspora, but at the same time signaling that they are not being counted as Guyanese?”, the AFC asked.
The party, which was a partner in the former APNU+AFC government, said that the about-face by the PPP/C administration is no guarantee that the audit will be done.
The AFC said that questions have arisen since there is no provision in the 2016 Production Sharing Agreement for the reopening of an audit after the expiration of the two-year period. Citing the PPP/C government’s view that the 2016 agreement is sacrosanct, the AFC asked how would the auditing promise be kept?
As a proven fail-safe way of saving face out of its dilemma, the AFC called upon the Government to not approve the fourth prospective oil extraction project at Yellowtail until Exxon agrees to the Audit.
The AFC said that a similar demand of the Environmental Protection Agency under the APNU+AFC government, proved to be successful in obtaining unlimited liability assurance coverage from Exxon’s subsidiary, EEPGL as a condition for approving the Liza 2 project but that the PPP/C Government promptly reversed that decision.
The AFC said that when the PPP/C was in opposition, it was loud in condemnation of the APNU+AFC coalition’s efforts to audit ExxonMobil’s US$460M pre-contract costs.
“…this audit was completed over a year ago, however no details of the result have been made public. The result of the pre-contract audits would provide the country with invaluable insight to billing practices of the operators”, the AFC said.
It added that the public may be under the impression that the US$9.5b being audited only pertains to the costs for the Floating, Production, Storage and Offloading platform and oil drilling operations. However, included in this US$9.5B are other costs, such as:
* The cost for their new HQ being constructed in Ogle,
* Every time Exxon charters a private plane to travel from the US to Guyana, this is cost reimbursable,
* Every function that Exxon hosts, every bottle of wine drunk by the invitees at these functions can be listed as cost recoverable.
* Every social media ad, claiming that the company is good corporate citizen is cost recoverable.
* Included in this US$9.5B will be the salaries for persons in Houston and other parts of the world who the company may claim are working on Guyana projects – in fact every single item despite how remote, with even the merest or no connection to Guyana, can be included, the AFC said.
It added that the opposition has already submitted several questions to the Minister of Natural Resources but based on the recent announcement that an audit will be undertaken, several more are required to be answered.
It listed these as:
1. What mechanism will be used to appoint the new auditors, since the previous public tender process has been discontinued?
2. Has ExxonMobil agreed to this extension? If yes, are there any conditions attached to this agreement by the operator?
3. What is the timeframe for the commencement and completion of this new audit process?
4. If the audit determines that ExxonMobil owes the country, what would be the mechanism for the company to reimburse the country?
5. It is reported that ExxonMobil has requested an extension to the time frame for the relinquishment of sections of their concession, has the Government entered any discussion with the company to extend their relinquishment period, in exchange for ExxonMobil agreeing to extend the audit period?
These and other questions, the AFC said, require full and frank responses from the Government.
