The oil and gas com­pa­ny, Exxon­Mo­bil, says it is await­ing “a for­mal re­sponse” from the Guyana gov­ern­ment, amid the con­tro­ver­sy that has erupt­ed here over a re­duc­tion in its au­dit­ed US$214 mil­lion ex­pense.

Vice pres­i­dent Bhar­rat Jagdeo has called for an in­ves­ti­ga­tion to de­ter­mine why the Min­istry of Nat­ur­al Re­sources (MNR) went ahead and ne­go­ti­at­ed a re­duc­tion in Exxon­Mo­bil’s au­dit­ed ex­pense.

Jagdeo, who main­tained that the Guyana Rev­enue Au­thor­i­ty (GRA) is the sole agency law­ful­ly man­dat­ed to au­dit the ex­pens­es, said the in­ves­ti­ga­tion should de­ter­mine why the MNR went ahead and ne­go­ti­at­ed a re­duc­tion to as low as three mil­lion US dol­lars.

“No mon­ey has been stolen, but some­body has to give an ex­pla­na­tion how they en­gaged with Exxon,” he told a news con­fer­ence, adding “we be­lieve there should be a full in­ves­ti­ga­tion but we have not com­plet­ed the au­dit, the min­istry has to now write Exxon.

“… I be­lieve al­so that we have to have a pol­i­cy where peo­ple, at the tech­ni­cal lev­el par­tic­u­lar­ly, who en­gage with the oil and gas com­pa­nies and ex­ec­u­tives, that they must seek the ex­plic­it clear­ance from the min­istry and they must re­port back on the na­ture of every en­gage­ment,” Jagdeo said.

But in its state­ment, Exxon­Mo­bil said au­dit­ing an oil and gas joint ven­ture op­er­a­tor’s ex­pens­es is a stan­dard process by co-ven­tur­ers and gov­ern­ments to en­sure on­ly ap­pro­pri­ate costs are charged.

“It’s nor­mal for au­di­tors to high­light fo­cus ar­eas by shar­ing a draft re­port that is lat­er ad­dressed with ad­di­tion­al doc­u­men­ta­tion. Our ex­pe­ri­ence is that typ­i­cal­ly, very few, if any, costs are ul­ti­mate­ly re­ject­ed, re­flect­ing the in­tegri­ty and qual­i­ty of our ac­count­ing ac­tiv­i­ties.”

The oil and gas com­pa­ny said that the Guyana gov­ern­ment has au­dit rights un­der Ar­ti­cle 23 and An­nex C of the Stabroek Pe­tro­le­um Agree­ment.

“We have act­ed in good faith and co-op­er­at­ed with the Gov­ern­ment and their con­sul­tants ap­point­ed for the cost re­cov­ery au­dit of the 1999-2017 years.

“We have sup­plied re­spons­es and doc­u­ments to the is­sues raised in the draft au­dit re­port pre­pared for the Gov­ern­ment by their con­sul­tant. We now await a for­mal re­sponse from the Gov­ern­ment, af­ter which we will en­ter in­to fur­ther di­a­logue as nec­es­sary,” it said in its state­ment.

Last week, the main op­po­si­tion A Part­ner­ship for Na­tion­al Uni­ty and the Al­liance for Change (AP­NU+AFC) called for Jagdeo be re­lieved of his port­fo­lio of Oil and Gas.

The op­po­si­tion said that this is nec­es­sary af­ter the Pe­tro­le­um Unit at the Nat­ur­al Re­sources Min­istry cut the US$214 mil­lion in ques­tion­able ex­pens­es in­curred by Exxon­Mo­bil for its ex­plo­ration of the Stabroek Block, to US$3 mil­lion.

Jagdeo has said he stood by the GRA’s no-ob­jec­tion to the US$214 mil­lion in dis­put­ed costs flagged by the British-based IHS Mark­it in its au­dit of Exxon­Mo­bil’s US$1.7 bil­lion in ex­pens­es in­curred for the pe­ri­od 1999 to 2017. (CMC)