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Jagdeo refuses to inform the nation about ExxonMobil’s use of Guyana’s oil profit recovery in its works in Kaieteur and Kanye blocks
Kaieteur News – Vice President Bharrat Jagdeo has refused to update Guyanese citizens on the progress made by the government in recovering funds that auditors revealed were spent by oil giant ExxonMobil from the Stabroek Block to pay for works in the Kaieteur and Kanye Blocks. The Vice President addressed the media at his weekly press briefing at Freedom House on Rob Street on Thursday.
Vice President Bharrat Jagdeo.
Jagdeo, the oil and gas industry’s top decision-maker, has refused in recent months to answer a number of important questions central to his portfolio. These include: the status of Guyana’s oil reserves; the lease payments for the capping stacks that ExxonMobil recently brought into the country, and how much the company is paying to treat wastewater from its offshore operations. Jagdeo also refused to provide a full update on the results of an audit and the interest rate that ExxonMobil Guyana Limited (EMGL) is charging on its investments.
Asked by Kaieteur News on Wednesday if he had “been in any progress to recover the money that auditors found ExxonMobil spent in Kaieteur and Kanye fields?” Jagdeo responded: “So last time you said the minister didn’t want to answer some of your questions. So he would hold press conferences, all these routine things, none of which are policy-oriented, you can find them there.” The publication previously reported that the audit team reviewed $7.3 billion in expenditure incurred by ExxonMobil between 2018 and 2020 and found that the company used $323 million in revenue generated by the Stabroek block to purchase vehicles for operations in the Kaieteur and Kanye blocks.
According to the report completed by the auditors, the operator of the Stabroek block, ExxonMobil Guyana Limited (EMGL), formerly known as Esso Exploration and Production Guyana Limited (EEPGL), included 100% of the cost of various vehicles in its cost recovery statements.
However, the auditors determined that the vehicles purchased were used in all ExxonMobil operations, including those outside the Stabroek block. As such, the auditors informed the company that these costs should be apportioned between the blocks. In response to the auditors’ findings, ExxonMobil confirmed that the vehicle costs were deducted from the Stabroek block. However, the company disagreed that the vehicle costs should be apportioned. The auditors said ExxonMobil “verbally suggested that it was reasonable to charge Stabroek 100% of the fees because, in other words, the contractor was in the country for the Stabroek business.” The report highlighted that between 2018 and 2020, ExxonMobil purchased vehicles worth $1,617,143.85 from Beharry Automotive LTD, Ideal Autos Inc. and Massy Motors Guyana LTD. This amount is just over Guyana Dinar 323 million. Although the government said that using Stabroek block funds to offset expenses on other blocks was illegal, ExxonMobil will not face any form of punishment. Jagdeo said at a previous press conference that the contract the oil giant signed with Guyana meant the expenditures would not be included in the cost bank for the Stabroek block. “I insist that it is illegal, I repeat. The audit will reveal that now and as I said before, there will be consequences. If you do unauthorised work, under the PSA you will not go to jail, it is just that it is not part of the cost bank,” the vice president said.
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