-says typographical error was made
-both companies set for court on GRA summons
ExxonMobil yesterday distanced itself from the huge inflation of an invoice detected by the GRA and pointed to its former broker which it did not name and both are set to appear in court next week over the matter.
Stabroek News yesterday reported on the massive inflation of the invoice from an estimated US$4.4m to US$12.1b.
In a brief statement yesterday, the company said: “ExxonMobil Guyana (EMGL) became aware of a clerical error in a Customs declaration filed by our former broker in 2023 from an investigation initiated by the Guyana Revenue Authority (GRA). EMGL did not compose the erroneous declaration, nor were we aware of this clerical error when the declaration was filed. EMGL is cooperating fully with the GRA in its investigation of this matter”.
The broker in question is Ramps Logistics Guyana Inc (RLGI).
ExxonMobil has written to the Guyana Revenue Authority (GRA) to put itself in the clear. Its controller, William A Thompson wrote to Deputy Commissioner, Jason Moore on April 16 stating that EMGL was not the declarant and had not made any false declaration.
In the correspondence seen by Stabroek News, Thompson said the declaration was made by RLGI “as borne out by the information in column 14 of the prescribed customs declaration form” provided by the GRA.
He added that EMGL has not made or caused to be made any false declaration.
“Any error made by RLGI was a typographical error which did not inure to the detriment of or cause any loss” to the GRA.
Ramps in its defence has said that the declaration was prepared based on information provided by ExxonMobil Guyana Limited through its KABAL System.
Addressing that contention, Thompson “To the best of EMGL’s knowledge, all information that was available to RLGI from the KABAL platform was accurate and any error was not caused by EMGL”.
Under its contract with EMGL, Thompson said that RLGI had an obligation to review and verify all inbound shipping documentation such as bills of lading and packing lists etc and ensure that all such documentation was accurate and correct and met the country’s customs requirements.
“In these circumstances there are no apparent circumstances why proceedings ought to be instituted against EMGL as a matter of fact or law. EMGL is ready to engage with the Guyana Revenue Authority in the spirit of (dialogue) and cooperation to address any remaining concerns that the Authority may have on this matter”, he added.
The inflation of the invoice, whether by mistake or other, underlines the importance of assessing the expenses that ExxonMobil and its partners are claiming for cost oil. If a US$12b transaction compared to US$4m was passed, it would reduce profits due to Guyana and its partners by the difference between the two figures. Cost oil can account for up to 75% of oil produced each year.
To date, neither of the two major audits of expenses by ExxonMobil and partners has been brought to a conclusion and in relation to the first by UK firm IHS Markit, the Guyana Government and ExxonMobil may be headed to arbitration.
Oil-well equipment
The inflated invoice pertained to a quantity of oil-well equipment imported on behalf of ExxonMobil Guyana.
According to reports, the revenue authority said that an investigation it conducted uncovered that in November of last year, Ramps Logistics allegedly inflated the invoice value for a consignment of goods on behalf of ExxonMobil.
According to a report seen by this newspaper, on November 16th last, Ramps declared to Customs that the goods were valued at US$12,192,103,923.91
The actual cost, however, of the imported goods the GRA said was US$4,467,662.
Additionally, reports say that Ramps Logistics allegedly falsely declared itself as being the supplier of the goods imported by ExxonMobil when the suppliers were Baker Hughes and Technip FMC.
As a result, the revenue authority said that in January, of this year Ramps Logistics was made to show cause why proceedings should not be instituted against it for violating the Customs Act.
According to reports, two weeks later Ramps responded via letter stating among other things that the false declaration was prepared based on information provided by ExxonMobil Guyana Limited through its KABAL System.
The reports said that to further support its claims Ramps presented a demonstration of how the information was extracted from Exxon’s KABAL System.
In keeping with the principles of natural justice, the GRA thereafter dispatched a letter dated March 18th 2024 to ExxonMobil requesting it to show cause why legal proceedings should not be instituted against it.
Particulars of the complaint against both Ramps and Exxon are that contrary to the Customs Act, they on November 16th, 2023 falsely declared to the Guyana Revenue Authority that the value for a quantity of oil-well equipment and supplies was US$12,192,103,923.91
Background
Back in October 2022, the GRA filed 10 charges against Ramps Logistics for false declarations; but the company had said that the charges were null and void and pointed out that the court action had come just days after it had sought judicial review over the conduct of the Local Content Secretariat.
Like with the current case filed against Ramps, the charges in October 2022 the GRA said stemmed after investigations carried out by its Law Enforcement and Investigations Division.
The investigation determined, among other things, that during the period 2021 to 2022, RLG – whose parent company is in Trinidad and Tobago – made several untrue declarations to the Revenue Authority.
One of those charges stated that “The defendant on the 29th day of June 2022 at lot 200-201 Camp Street, Georgetown, a place in the Georgetown Magisterial District, made and subscribed a false declaration to the Revenue Authority, to wit the defendant falsely declared itself to be the sellers of a quantity of Barite listed on invoice number INV#MVKAWA1EP-20 dated on the 21st day of March 2022.”
On April 25 last year, Ramps said that it had been cleared of all charges brought against it by the GRA.
In a press release, Ramps Logistics said that it made its final appearance in the Georgetown Magistrate’s Court #6 before Magistrate Dylon Bess in the matter brought by the GRA on October 5th, 2022.
