Exxon Boss says arbitration last resort to resolve audit findings

disciplinary action now facing the government’s Senior Petroleum Coordinator, Gopnauth Gossai over what the government has said is his unauthorised and unsanctioned engagement with the company.

The Ministry of Natural Resources recently revealed that Gossai was the one who engaged in discussions with ExxonMobil and reduced a US$214 million in questionable spending by its local subsidiary from 1999 to 2017 to US$3 million.

The government has since said that the local authority to deal with the audit findings on spending is the Guyana Revenue Authority (GRA).

During a press conference on Tuesday at the company’s Kingston, Georgetown headquarters, Routledge said he looks forward to an amicable resolution outside of arbitration.

“I feel very sorry for Mr. Gossai. He was working diligently and in support of the process…unfortunately, the right paperwork didn’t get to the right people.

“He worked with the best of intent,” Routledge said.

He told reporters that ExxonMobil Guyana is in support of more regular and on-time audits, noting that the issues raised now and the confusion surrounding the audit for the period 1999 to 2017, are due to the length of time taken before the audit was done.

While this audit (1999 – 2017) addresses a cost recovery of US$1.6 billion, the second audit currently underway (2018 – 2020) looks at a cost recovery of US$7.2 billion.

Routledge reminded that while the first audit kicked off in 2019, it goes back more than 20 years and it was also started under a different government.

He explained that while the audit process is normal for ExxonMobil with internal processes and audits by its co-venturers ongoing, there was some confusion about which agency in government was handling the audits.

He said ExxonMobil was providing additional documentation it had to retrieve from its archives to Gossai without knowing that those documents should have gone to the GRA.

“We were doing that on a working level with the Ministry and it caused some confusion.

“We now know the GRA is the body and they wrote a letter last week clarifying and asking that we provide them with the documentation,” the ExxonMobil Guyana President said.

He said the process is ongoing and that ExxonMobil will re-engage GRA officials to review audit documents.

“Exxon was of the opinion that we were in contact with the right technical people.

“More recently we got clarity…we don’t know what’s happening behind the doors in government. What’s been made clear now is that we deal with GRA,” Routledge added.

He said the process continues with no formal closure although ExxonMobil provided additional documentation to Gossai to support the spending of US$214 million, allowing it to be brought down to about US$11 million and later, US$3 million.

Those documents are now being submitted to the GRA for their review and ExxonMobil is looking for a favourable outcome.

“We will follow the process.

“Our distinct desire is not to go to arbitration because we all should be clear about what rules are.

“That would be the last resort if we arrive at arbitration,” he explained.

To avoid a recurrence of this, Routledge proposes that all stakeholders catch up on the auditing process and said there is a need to get on a regular cycle of auditing every year.