US$160M for ExxonMobil's Ogle HQ not recoverable unless former or current Govt. gave special permission

Chris Ram

Following his analysis of the a c c o u n t i n g procedures in the 2016 Stabroek Block agreement, Chartered Accountant and A t t o r n e y - a t - L a w , Christopher Ram believes the US$160M bill for E x x o n M o b i l ' s O g l e Headquarters is not cost recoverable, unless, special permission was granted by the former or current government.

Ram believes that it was Natural Resources Minister, Vickram Bharrat or his predecessor, Raphael Trotman that provided Exxon with the requisite approval. In any event, he posited that the public deserves to know who committedthisact.

Ram addressed this matter in his latest column, “Every man, Woman and

Child in Guyana Must Become Oil-Minded Part 104” that was published in the Stabroek News on Friday. He recalled that it was Opposition Member of Parliament (MP), Ganesh Mahipaul, who tabled a question in the National Assembly on whether the cost of the HQ was recoverable. Ram also noted that ExxonMobil's Country M a n a g e r , A l i s t a i r Routledge, emboldened by his increasingly comfortable relationship with the People's Progressive Party Civic (PPPC) Government, reacted to Mahipaul by d e c l a r i n g t h a t t h e approximately US$160M would be recovered using Guyana'soil.

In reviewing the contractual provisions that state what costs are recoverable, Ram said there is no mention that a headquarters to be used by a single contractor is fair game.

He did note that there is one loophole which may have been utilized. In this regard,Ramsaidthecontract allows the recovery of “Other Costs and Expenses incurredbytheContractorin the conduct of the Petroleum Operations” but subject to the approval of the Minister R a m s a i d t h e o n l y outstanding question left is the identity of the Minister that implemented this provision.

Ram said the issues surrounding the Ogle Office are not only financial. He said the land it sits on also bears several concerns. He s a i d E x x o n M o b i l ' s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL) has subleased from Ogle Airport Inc. (OAI), ten acres out of the hundreds of acres of land leased from the Government to OAI for airport development.

Ram said there are two “clearances” which were required to make this legally possible. “One, OAI needed approval for subletting the land for non-airport purposes and two, by virtue of section 333 of the Companies Act of Guyana, Esso needed a licence, authorised by the President no less, to hold land in Guyana,”thelawyerstated.

He then questioned, “Was it President Granger whoseAdministration sleep- walkedintosigningarguably the worst oil contract in the petroleum world in the modern era, or President Irfaan Ali whose PPPC Government in 2012 birthed the model for the infamous 2016 Petroleum Agreement, andwhichhasfailedatevery opportunity to protect, promote and defend Guyana's interests ahead of thoseoftheoilcompanies?”

He alluded that this is another critical question that the citizenry deserves to haveanswered.

Takingtheforegoinginto consideration, Ram in closing said, “…There is no doubt that when it comes to m a l a d m i n i s t r a t i o n , negligence, slackness and squandering the people's patrimony, not even water, let alone oil, separates the P P P C f r o m t h e APNU+AFC.”