Jagdeo skirts question on Guyana’s 50% profit share with Exxon

Jun 17, 2025 News

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…as companies walk away with US$10.4B while Guyana gets US$2.6B with its 2% royalty

Kaieteur News – Vice President, Bharrat Jagdeo who is also the chief policy maker in Guyana’s oil and gas industry, is yet to give a straight answer on how it was possible for Exxon and its partners in the Stabroek Block to walk away with US$10.4 billion, while Guyana received a mere US$2.6 billion, despite a 50/50 profit sharing and Guyana’s 2 per cent royalty agreement.

Kaieteur News asked the Vice President two Thursdays ago, “can you explain Exxon and its partners reporting that their profits for 2024 being $10 billion, but Guyana only got $2.6 billion US despite it being a 50/50 profit sharing?”

He responded, “so I saw, I saw something about Exxon, um reporting a trillion dollars in profit over the 3 years and they said that the government got about $1.3 trillion. So that’s about consistent with the formula, which says that 14.5 per cent of the 25 per cent which is set out for as profit sharing would result in those that configuration, and they would have 10.5 per cent. So that’s consistent from what I saw. It can’t be any different in these years.”

Jagdeo further shared, “They have to get less profits than we would have received because of that formula. They, they’ve spoken about paying back the capital which is a different matter about paying back the capital invested which comes out of the 75 per cent allocated of revenue allocated for that purpose. So, we can’t conflate the two, (they are) very different and it’s consistent with the formula, and just to tell you that to give you an indication if they say $1.3 trillion, we got since the beginning of oil that’s less than this year’s budget one year budget, that’s what we got from the beginning so that confirms what we have been saying because we passed five budgets so far. So entirely clear.”

Jagdeo was only asked to explain how the formula works, as the numbers did not seem to add up. He said, “It’s a simple you have 100 per cent of revenue, 75 per cent goes to cost recovery right, 25 per cent is for profit sharing, so that means 12 and a half to Exxon and 12 and a half to the government, but then they have to, from their 12 and a half, give us the 2 per cent royalty. So, we end up with 14 1/2 and they end up with 10 1/2. So that’s how it works.”

It is important to note that royalty is usually paid from all petroleum produced and sold, but in Guyana’s case, royalty is paid from Exxon’s share of the profits after the company recovers it’s 75 per cent cost.

On June 5, Yahoo Finance reported that “ExxonMobil Corporation and its partners, Hess Corporation and China’s CNOOC, reported a combined profit of $10.4 billion from their oil operations in Guyana in 2024, marking a 64 per cent year-on-year jump, according to ExxonMobil’s latest operational update. The surge was driven by expanded production capacity and favorable fiscal terms that continue to make Guyana one of the most lucrative oil plays globally.”

“ExxonMobil alone booked $4.7 billion in adjusted earnings from its Guyana operations last year, contributing substantially to its global earnings of $33.46 billion. Meanwhile, Hess posted $3.1 billion in profits from the region, up from $1.9 billion in 2023, while CNOOC earned $2.5 billion, rising from $1.5 billion,” the article said.

On June 4, this publication reported that ExxonMobil Guyana Limited (EMGL), the subsidiary of Exxon Mobil Corporation in 2024 recorded an operating profit before taxation of almost US$6 billion, the company’s annual report has revealed.

The company shared the document with members of the media at its Duke Street, Kingston, Georgetown office.

Explaining the financial performance of the oil company was newly appointed Business Services Manager, John Colling. He noted that the increase in the company’s profits was primarily due to the startup of the third Floating Production Storage and Offloading vessel (FPSO), Prosperity, which commenced production activities in November 2023 but reached maximum capacity in January 2024.

Colling noted, “In 2024, ExxonMobil Guyana Limited generated $1.7 trillion (GYD) in revenue, which is up about 60 per cent from the prior year and that’s really driven by the Prosperity FPSO coming online and higher production volumes.”

Similarly, the business services manager said the company’s net income also increased to $995 billion (GYD) in 2024, compared with $615 billion (GYD) recorded in 2023, as a result of the addition of the Prosperity vessel.

Additionally, the startup of the vessel also accounted for an increase in production costs in 2024 which totaled $61.3 billion, compared with only $41.1 billion in 2023.

Exxon reported a tax expense of $260,155,788,763 (GYD) and $995,144,810,603 (GYD) as its total comprehensive income for the year. It is important to note that the company, in accordance with the provisions of the 2016 PSA is exempted from paying taxes. As such, it could be accurately concluded that the company’s profits for the year totaled $1,255,300,599,366.

The 2024 annual report indicated that the exchange rate at the end of the financial period was US$1 = G$210, hence Exxon recorded US$5,977,621,901 as operating profit before taxation.

In 2024, ExxonMobil produced approximately 652,000 barrels per day (kbd). During the period, Liza Destiny produced approximately 157 kbd, Liza Unity 246 kbd and Prosperity 249 kbd.

President of EMGL, Alistair Routledge in the report said reflecting on 2024 fills him with both pride and gratitude for the collective efforts that have culminated in what has been described as “one of the most remarkable success stories” globally.

“Our journey in Guyana is just beginning, poised to further transform the country and its economy, bringing significant and broad benefits to its citizens…We have consistently grown production year-over year since the first oil production milestone in 2019. As a result, Guyana is now one of the largest oil producers per capita in the world, and it boasts the world’s fastest-growing economy,” Routledge noted.

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• 2% royalty, Bharrat Jagdeo, ExxonMobil Guyana, Guyana’s oil and gas, Profit share, Stabroek Block

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