ExxonMobil charging Guyana nine times more than its partner CNOOC for admin
Chartered Accountant, Christopher Ram
By Abena Rockcliffe-Campbell
There are several disparities highlighted in the way Esso Exploration and Petroleum Guyana Limited (EEPGL) handles its financials when compared to its partner, CNOOC/NEXEN.
For one, both subsidiaries have borrowed monies from their parent companies to fund their operations. However, in its financial statement, CNOOC was keen to point out that no interest is being charged on the sum.
CNOOC said, “The Branch owes the company, for advances to fund the Branch’s exploration activity. The amount due to the company is unsecured, non-interest bearing, and has no fixed terms of repayment.”
However, EEPGL, a subsidiary of ExxonMobil, failed to be that explicit. All that company said was that it received a loan. No mention was made of whether or not interest has to be paid. In any case, Guyana will have to stand the bill of any interest accumulated.
The disparities go further. The total debt of EEPGL in 2016 was $76.8B of which approximately $60B was incurred in 2016. This was pointed out by Christopher Ram in recent writings.
Ram noted that general and administrative costs for EEPGL were stated at $2.1B (This is $2.1B Guyana dollars and not US, as was inadvertently stated in yesterday’s article.)
Now, it is interesting to note that the $2.1B represents administrative costs only.
Expenses falling under administrative costs would include payments of accounting staff, rental
