Latest update March 20th, 2023 12:59 AM
Mar 14, 2023 News
Kaieteur News – The Alliance For Change (AFC) has disclosed that the cost to construct ExxonMobil’s local Headquarters has jumped from just around US$50 million to US$160 million even though the design for the structure remains the same.
Shadow Natural Resources Minister, David Patterson in pointing to the need for timely audits to be conducted, said the tripling of the project cost is worrying. He told members of the media: “the tender for Exxon’s headquarter was given out before 2020. Since 2018, Exxon indicated that they wanted to build a headquarter…when the contract was awarded, I think in either late 2019 or early 2020, the contract was given out for two buildings which will house 250 persons each…it would support the operations for Exxon for the next 40 years but I myself was amazed to hear that it was US$160 now.”
A contract was awarded to NABI/KCL Oilfield Construction Services Guyana in 2019 for the construction of the HQ at Ogle, East Coast Demerara. According to a Request for Information issued by ExxonMobil Guyana, the scope of works include construction of two buildings for 250 seats; an outdoor pavilion; paving; landscaping; fill and storm drainage; site utilities; plumbing utilities; and electrical works.
The Company – NABI/KCL Oilfield Construction Services Guyana is a Joint Venture of NABI Construction Inc., Guyana and Kee-Chanona Limited, Trinidad. Patterson argued that the Vice President, Bharrat Jagdeo has jumped to defend the increase in project cost, explaining that circumstances have changed with the company’s operations.
The former Minister of Public Infrastructure however argued: “In 2020, the project was under US$52 million or thereabout in total. It’s now US$160. Nothing has changed. They are still building; I checked my records and I found the write up. It’s the same 500 persons will be housed there. They haven’t added on an extra floor, they haven’t added on an extra building, it’s the same thing and he (Jagdeo) simply allows Exxon to say they are now going to spend US$160 million on a headquarters and he defends it and says the circumstances have changed.”
The Opposition Member of Parliament pointed out that by the end of 2020, the oil company had already made a significant number of offshore discoveries, therefore the design of the office building it tendered for was drafted to accommodate its increased project activities. Patterson said: “The main defender of the three times project cost is the Vice President Jagdeo. He just gives a very gentle (excuse) and says oh circumstances have changed, Exxon has to do more work. No, (that’s) hogwash.”
President of ExxonMobil Guyana, Alistair Routledge told members of the media at a press conference back in February that the US$160 million office complex would be recovered out of cost oil, meaning Guyana will foot the expenses to construct its local headquarters.
Following the announcement, Guyana Times reported VP Jagdeo justifying the project cost and its recoverability. “I did say in Opposition that the headquarters they were building at the time was several times the price of the Marriott. That was exactly what I said. And that for the scale of operation they had, they did not need such a headquarter building. And that headquarter building, if it continued in that form, we will not support it being cost recoverable,” the newspaper reported Jagdeo as saying.
He went on to explain, “But what has changed? One, when they started that headquarter when I said we’re producing 120,000 barrels a day. By the time we get to the completion of the headquarters, we’ll be producing 600,000 barrels per day. It has evolved from a headquarter building to house staff. They have 250 staff now, they’re renting. That would evolve to 500 staff, most of which will be Guyanese that will work there.”
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NABI-KCL had indicated that the size of the land allocated for the HQ now stands at 15 acres. The building is expected to have a net zero energy footprint.
NABI-KCL stated that it is “honoured to undertake this prestigious project for ExxonMobil Guyana and commend the emphasis on local content.”
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