The United States authorities should investigate ExxonMobil’s unauthorised discussions with Ministry of Natural Resources staff that led to a reduction in a disputed oil audit figure from US$214m to US$3m, former Auditor General Anand Goolsarran says.
Questioning the role of the company that is still to address the core issue of how it began the negotiations with unauthorized personnel, Goolsarran said that as a global company ExxonMobil must be patently aware of the processes of an audit, and that it could not re-enter negotiations after the audit is closed.
“And what of Exxon’s engagement with the staff of the Ministry in what the Minister considered unauthorized reduction of the disputed costs? The US oil giant ought to have been aware that the auditors’ report on the disputed costs is final, and that the matter ought not to have been re-opened,” he said, as he again discussed the issue in his accountability column in the Stabroek News.
“Last week, Member of Parliament David Patterson stated that Exxon’s Alistair Routledge indicated that the disputed costs have been reduced to US$3 million. Should the authorities in the United States not initiate a probe into the matter?” Goolsarran questioned.
UK firm IHS Markit had been hired to do the first ever audit of expenses of ExxonMobil and its partners for the period 1999 to 2017, and up to April 2nd this year the report was kept hidden until Stabroek News published the details. In the six months that followed there were attempts by the government and ExxonMobil to cut the figure but that apparently ended when the Guyana Revenue Authority (GRA) wrote a letter to the Natural Resources Ministry saying that it wouldn’t challenge the US$214 million figure and recommending that the audit be closed. That letter was also revealed to the public by Stabroek News and appeared to have forced the government to close deliberations.
Shadow Minister of Natural Resources, Patterson, told Stabroek News that ExxonMobil Country Manager, Routledge, informed the Opposition that the government had accepted that the US$214 million sum found by the IHS Markit audit would be reduced to US$3 million, statements contradictory to government’s subsequent position that it had accepted that the company overstated their expenses by the US$214 audit sum.
“They said they had completed it and they had resolved the audit issue. I went in thinking it was reduced to US$11 million but Routledge said it has been reduced to US$3 million. I was shocked. I asked him if he was sure and to confirm it. He said yes,” Patterson told Stabroek News in an interview.
“He also said they could have been reduced further because they have all their record boxes. Boxes and boxes of records, but it was time consuming so they and the government said, it was a waste of energy and manpower trying to do that [sort the boxes of documents] and they agreed to the US$3 million sum”, Patterson added.
ExxonMobil has steered clear of addressing how it entered into discussions with persons not authorised by the Government of Guyana concerning the US$214 million in questionable expenses cited in an IHS Markit audit report, but stated that it acted in “good faith” and cooperated with consultants, Goolsarran said that the company needs to frontally address the issue.
“We have supplied responses and documents to the issues raised in the draft audit report prepared for the Government by their consultant (IHS Markit). We now await a formal response from the Government, after which we will enter into further dialogue as necessary,” a statement from the company last week said.
The former Auditor General said that Minister of Natural Resources Vickram Bharrat’s role should be looked at and he should be held accountable, given his oversight of the sector.
“Did the Minister not receive a letter earlier from the GRA stating that it had no objections to the auditors’ report that identified US$214.4 million in disputed costs? How could the Minister then state that he and the Vice President were under the impression that the GRA was involved in a reduction of the disputed expenditure? In other jurisdictions, heads would have rolled,” he posited.
He gave an example of the former Housing Minister of Ontario, Canada, Steve Clark, who resign-ed for his failure to properly oversee the procedures leading to the slicing off and use of 7,400 acres of the protected Greenbelt lands for housing purposes.
And while government has initiated a probe, Goolsarran said that “Such a probe must be carried out by a person(s) who is/are not in any way involved in what has so far played out. Perhaps the Public Accounts Committee should take over the responsibility for initiating the probe and for reviewing the results.”
