Time for Exxon to address Guyana’s findings in audit of its 2018-2020 costs

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Vice President, Dr. Bharrat Jagdeo has confirmed that the government’s auditors have completed their assessment of ExxonMobil Guyana’s US$7.3 billion investments in the Stabroek Block from 2018 to 2020.

The official recently noted that the company has two months to respond to the government’s findings.

The audit was done by a group of local consultants, Ramdihal and Haynes Chartered Accounting and Professional Services Firm, Vitality Accounting and Consultancy Inc., and Eclisar Financial & Professional Services. They were hired last year to conduct the audit alongside the Oklahoma-based Martindale Consultants Inc. and the Swiss technical company, SGS. The value of the contract is US$751,000. The audit costs reviewed covered the US$3.6 billion Liza Phase 1 Project fully and part of the expenses plugged for the US$6 billion Liza Phase 2 Project.

The Vice President said effective and timely audit exercises are areas the government will be paying rapt attention to, while reminding of the need to build in-country capacity. “It is critical that we have well-trained, local eyes to do the audits in the future,” the official said.

He was also keen to note that any costs government does not agree with will be disallowed, adding that this approach will be relied upon to discourage the prevalence of inflated costs.

“Exxon has two months to respond and it will then be looked at to say if we agree with their explanations or not. If there is a dispute, there is a dispute resolution process in the contract for us to follow so let us await their response,” said the Vice President.

If an audit claim by the minister is not settled, the 2016 Stabroek Block Production Sharing Agreement states that the matter is to be referred to the International Centre for the Settlement of Investment Disputes for arbitration before three arbitrators.

In the meantime, the contractor shall be entitled to recover any disputed amounts, pending the final resolution of the claim. However, any subsequent adjustments in the minister’s share of profit oil following the resolution of the claim shall be repaid with interest at the agreed interest rate. 

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