Latest update March 28th, 2024 12:59 AM
Nov 15, 2022 News
Kaieteur News – As the nation awaits the completion of a US$9 billion review of the expenses handed to the country by oil giant ExxonMobil, between the years 2018 and 2020, Economist Elson Low has said that amendments to the Petroleum Act are needed to institute strict penalties on Officials for failure to conduct such audits and attempting to conceal the findings of same.
Low in an exclusive interview with this newspaper yesterday said he finds it troubling that President Irfaan Ali only recently came out to announce the delayed time for the Exxon audit. It was in May of this year that the contract was signed for a four-month review of the oil company’s expenses for the offshore activities. The process was expected to be completed in September, however the team now need an additional three months, President Irfaan Ali said last Friday.
The Head of State explained that, “They expect the first report before the end of December and the delay was because of coordination issues with the auditors themselves, which is natural in these circumstances so before the end of the year we expect the first report.”
To this end Low said, “That delay is troubling, because there was silence at the time when the audit was originally supposed to come out. We should have heard this explanation then, not now.” Low reasoned that he formally made his position clear that failing to audit Exxon should be a crime, however he went further during yesterday’s interview to note that, “concealing the results of an audit of any expenses of any oil company should also be a crime and the Government should also have a fixed time period within which, it must release the results of any audit.”
He believes that Government should be mandated to submit the audit reports to a Sub-Committee of Parliament such as the Public Accounts Committee or one of the Special Committees under the House. The Economist pointed out, “given that I have said that not auditing Exxon should be a crime, my perspective is that we should really amend the laws, whether it be the Petroleum Act or even the criminal code to ensure it is clear that it should be against the law for you to not audit Exxon or any other oil company and for concealing the audit reports.”
He was keen to note that penalties should be instituted for failing to audit such massive bills and hiding the findings from the country. Low believes that the Government has done a poor job so far in transparently managing the oil and gas sector which has resulted in a loss of confidence by stakeholders. Not only that but he believes this trait paints an ugly impression for prospective foreign investors on what to expect, said Lowe. “The idea of not immediately alerting the nation when the deadline for an audit to be released or the expected time for it to be completed, is very suspicious.”
On May 24 last, Government inked an agreement for a four month review of the bills handed to it by the oil company. The consultancy was awarded to VHE Consulting which is a registered partnership between Ramdihal & Haynes Inc, Eclisar Financial, and Vitality Accounting & Consultancy Inc. The Local Consortium is supported by International firms- SGS and Martindale Consultants for the ‘Cost Recovery Audit and Validation of the Government of Guyana’s Profit Oil Share’.
The audit will cost Guyanese some US$751,000. Minister of Natural Resources, Vickram Bharrat had assured that the findings of the audit would be made public. This is particularly important as the public is unaware of the outcome of the audit of the US$460 million pre-contract costs, which was done by IHS Markit. The contract to the UK firm had cost US$300,000.
In January of this year, Natural Resources Minister, Vickram Bharrat told the National Assembly that the audit was still ongoing. He said, “The Government of Guyana, when we took office was alarmed at the limited work done in this regard by the previous administration and immediately commenced with international consultants and local agencies to have a number of shortcomings addressed.”
Minister Bharrat added, “Currently, the Government is working to answer every questionable detail with the operator and the auditor to ensure that all expenditures are justifiable and accounted for as per the terms of the agreement.” In light of the fact that the Stabroek Block Production Sharing Agreement (PSA) only allows the State a two-year timeline to conduct such audits, Patterson asked the Minister to say if ExxonMobil was approached for an extension. Minister Bharrat did not state if ExxonMobil was contacted on that issue.
THIS IDIOT TELLING GUYANA WE HAVE NO SAY IN THE 50% PROFIT SHARING AGREEMENT WE HAVE WITH EXXON.
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