Exxon’s admin costs alone more than double Guyana’s wages bill

Jun 22, 2022 News

Kaieteur News- Guyana’s total wages Bill for 2020 was $6.1B and the following year that went up to $10.1B taking into account the revision of wages and salaries and according to the financial statements recently released by Esso Exploration and Production Guyana Limited (EEPGL), its administrative costs alone, inclusive of its wages bill topped 38.6B during that same period.
As such it would mean that the company’s administrative costs alone for the two years is more than double the entire wages and salaries bill for the entire country over the period in review.
Illustrated in the documents recently released, it was noted in EEPGL—ExxonMobil Guyana—Statement of Profit and Loss and Other Comprehensive Income that at the period ending December 2021, it had paid that year some $17.8B in administrative costs.
According to the records, the previous year it had spent some $20.8B accounting for some $38.6B in spending on administrative costs for EEPGL over the two-year period.
In contrast, Guyana would have spent some $16.2B for the country’s entire wages and salaries Bill over that two-year period.
This publication has in recent days been providing highlights of the entity’s financial performance in Guyana over the past two years.
It was reported that at the end of 2021, it recorded a $132B profit after working in the Stabroek Block since 1999.
Revenue for the reporting period increased to $254B reflecting higher production volumes and a stronger price environment versus 2020. Importantly, the company said this was the first profitable year it recorded since working in the basin.
Kaieteur News understands that overall expenses in the Stabroek Block were up in 2021 versus 2020 mostly due to increased production costs and higher depreciation, both of which were driven by increased oil production.

ExxonMobil Guyana’s Vice President and Business Services Manager, Phillip Rietema

In its Statement of Financial Position, at year-end 2021, assets totalled $1.3trillion, an increase of 30 percent versus the prior year mostly reflecting substantial incremental investments in the Stabroek Block.
Also, EEPGL’s equity increased 25 percent versus year-end 2020 to $875B driven by earnings and additional equity contributions. The subsidiary said this underscores its strong financial position to meet its ongoing obligations to the government and people of Guyana.
EEPGL’s Vice President and Business Services Manager, Phillip Rietema had told media operatives at the time the information was released that the performance of the company underscores the years of investments required before pay off.
The Exxon Executive had said, “…our total investments to date total $1.3trillion, and with our partners it is over $3trillion. With the plans we have in place out to 2025 will take investments north of $6T. We continue to invest greater than the returns we receive and we will continue to do so for many years.”
To date, EEPGL and its co-venture partners, Hess Corporation and CNOOC Group, currently have four sanctioned developments on the Stabroek Block.
The Liza Phase 1 development, which began production in December 2019 utilising the Liza Destiny floating production, storage and offloading vessel (FPSO) with a production capacity of approximately 120,000 gross barrels of oil per day, recently completed production optimisation work that expanded its production capacity to more than 140,000 gross barrels of oil per day.
The Liza Phase 2 development, utilising the Liza Unity FPSO, began production in February 2022 and is expected to reach its production capacity of approximately 220,000 gross barrels of oil per day by the third quarter.
The third development at Payara is ahead of schedule and is now expected to come online in late 2023 utilising the Prosperity FPSO with a production capacity of approximately 220,000 gross barrels of oil per day.
The fourth development, Yellowtail, is expected to come online in 2025, utilising the One Guyana FPSO with a production capacity of approximately 250,000 gross barrels of oil per day.
At least six FPSOs with a production capacity of more than one million gross barrels of oil per day are expected to be online on the Stabroek Block in 2027, with the potential for up to 10 FPSOs to develop gross discovered recoverable resources.

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