Guyana seeking firm to conduct audit, validate profit oil share for 2021-2023 period

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Guyana’s Ministry of Natural Resources has issued a call for consultants to submit proposals for the auditing of recoverable contract costs and validation of profit oil share related to the Stabroek Block operations for the period 2021-2023. Preference will be given to local companies that are engaged in joint ventures, partnerships, or consortia with globally acknowledged accounting and audit firms.

This request for proposals (RFP) follows previous audits undertaken for cost recovery and validations of the government’s profit oil share for periods dating from 2020 all the way back to 1999 when the first petroleum agreement was signed with ExxonMobil for the Stabroek Block.

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The fiscal terms of the Stabroek Block petroleum agreement allow the companies ExxonMobil, Hess, and CNOOC to recover their costs by taking up to 75% of the crude produced annually, with the remainder being split 50-50 between the government and the companies. Profit oil as a share of the produced crude, therefore, stands to increase when costs are substantially recovered. The audit processes are essential for the government to ensure a comprehensive understanding and implementation of the fiscal terms of the petroleum agreement.

According to the RFP, applicants should possess a comprehensive background in contract compliance reviews, joint venture audits, and auditing petroleum costs within the framework of production sharing contracts and other petroleum-related agreements. Additionally, they should have an understanding of the fiscal consequences of such audits. 

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The assignment encompasses a pre-audit analysis, developing an effective audit plan with an appropriate methodology, executing the audit in adherence with the provisions of the petroleum agreement, applicable local laws, regulations, procedures, and international good practices and standards. It also includes conducting verifications of the crude oil valuation pursuant to the petroleum agreement for the audit period, verifying royalties remitted to the government in accordance with the petroleum agreement, validating the accuracy of the total government share of petroleum for the period under review, and assessing the impact of the audit on future profit oil revenues.

The Guyana Revenue Authority (GRA) is the designated client’s representative under this project. Consultants interested in undertaking this project are required to have completed at least three similar assignments during the past seven years. The proposed team members should have in-depth international experience, local and regional knowledge, access to benchmarking for comparable deepwater environments, and consist of professionals including transfer pricing specialists, financial analysts, tax lawyers, cost accountants, crude oil valuation experts, chartered accountants, certified public accountants, certified fraud examiners, procurement and contracts experts, a partner who specializes in natural resources risk management, and a partner with expertise in cost recovery audits in oil and gas.

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Proposals are expected to be submitted no later than Tuesday, March 5, 2024, at 9:00 at the Office of the National Procurement and Tender Administration Board (NPTAB) of the Ministry of Finance in Georgetown. 

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