Mar 25, 2016 News
During his tenure, sacked head of the Guyana Oil Company (GuyOil), Badrie Persaud, approved thousands of transactions for that state-owned entity.
Many of them breached protocols and cost the country millions of dollars because of the absence of proper procurement procedures.
Some of the more blatant transactions found by the auditors involved GuyOil’s handling of fuel purchasing.
Between November 1, 2011 and May 31, 2015, according to a report from auditors, GuyOil purchased fuel totaling $94.5M from one Deodat Dhanrajh.
Dhanrajh was a major shipper of fuel, contracted by GuyOil. It is unclear why the Managing Director turned to Dhanrajh.
What is clear is that a week before the May 11, 2015 elections, GuyOil purchased from Rubis, one of the major sellers in Guyana, some 238,481 litres for $47.4M. The transaction was for $199 per litre.
GuyOil then turned to Dhanrajh, the transporter, two days later taking an order from him at the same price.
The auditors in flagging the transaction believed it was a clear case of staggering and splitting of a full order to facilitate Dhanrajh in the transaction.
The auditor, Nigel Hinds Financial Services, was convinced that the fuel could have been sourced at a lower negotiated price based on the volume of purchases from Rubis.
What made the transaction even worse was that on May 3, 2015, GuyOil’s wholesale price was $172.30.
Two days later, GuyOil changed the wholesale price to $198. It amounted to millions of dollars in losses for GuyOil.
The auditors also said that on checking transactions with Dhanrajh, they found fuel purchases for the period January 1, 2011 to June 30, 2015 to be $94M.
Dhanrajh shared a cozy relationship with GuyOil as he was allowed to even enter his shipping arrangements without the proper procurement processes being followed.
“It was obvious that Mr. Dhanrajh enjoyed a special relationship with GuyOil in this… and other arrangements,” the audit report said.
During the period of review, Dhanrajh received $199.8M for shipping of fuel to GuyOil without even a contract in place.
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