Information Americas, NEW YORK, NY, Mon. Aug. 18, 2025: On July 2nd, 2025, Stabroek Information revealed a letter from the Vice President and Chief Monetary Officer, (CFO), of ExxonMobil Guyana Restricted, (EMGL) disputing Chris Ram’s assertion that the 2024 financials for the Stabroek Block consortium (consisting of EMGL, HESS Guyana, and CNOOC Guyana) symbolize “a basic distortion that calls for fast investigation, consideration, transparency and disclosure.” The Exxon Guyana CFO’s response to Ram’s assertion that the accounting was flawed was obscure and missing in depth. Nonetheless, it contained a veiled risk on this assertion: “The accusation that we manipulate accounting requirements to enhance our monetary outcomes is unfounded and defamatory.”
In 2024, the oil extracted and bought totaled US$18 billion. To place that in context, Guyana’s 2025 finances was US$6.6 billion. Thus, distortions within the oil consortium’s monetary statements are materially important for Guyana.
Exxon is an organization valued at greater than US$600 billion, making it one of many largest firms on this planet. As a big US public firm, its inventory is owned instantly and not directly by thousands and thousands of shareholders. Its main precedence is to maximise shareholder worth, which is mirrored in its inventory value. Accusations that one in every of its main subsidiaries’ financials are distorted may elevate doubts in regards to the firm’s valuation amongst analysts and shareholders. Therefore, one would anticipate that the corporate would right this matter instantly or vehemently defend its repute by taking the matter to court docket, not reply by way of a obscure letter.
Mr. Ram promptly stood by his assertions in a letter dated July third, 2025, the place he supplied specifics on why EMGL’s accounting is indefensibly lacking. He additional acknowledged, “Exxon exhibits no respect for the folks of Guyana, weaponizing accounting complexity to keep away from knowledgeable public scrutiny.” It has been greater than a month since Ram stood by his assertion, whereas the EMGL silence has been deafening however insightful.
The chart beneath, interactive copy, exhibits the entire quantity of oil produced and bought per yr in US {dollars}, which totals US$43.5 billion. Guyana ought to obtain a 2% royalty and a 50/50 revenue share. Nonetheless, if the accounting is questionable, then absolutely Guyana’s 2% royalty and 50/50 revenue share, each derived from the oil firms’ financials, are incorrect?
In April 2019, the Stabroek Block oil contract was amended to make sure the oil firms couldn’t declare the two% royalty as a cost. Nonetheless, of their 2024 earnings statements, EMGL claims a Royalty Expense of US$164 million. We be aware that neither HESS Guyana nor CNOOC Guyana earnings statements lists such an expense. Thus, as a substitute of parroting ‘the sanctity of contract’, the federal government ought to examine whether or not EMGL’s US$164 million royalty expense was illegitimate below the up to date contract phrases.
In 2018, Ram confirmed – utilizing the oil consortium’s personal monetary statements – that the pre-contract prices have been overstated by US$90 million or 24%. Now, Guyana’s revenue share from the US$43.5 billion is roughly 12.5%, assuming prices are 75%. Thus, whole value is roughly US$32.6 billion and Guyana’s 12.5% is US$5.4 billion. If the fee have been inflated by 24%, then the uninflated value can be US$26.3 billion, which implies Guyana’s 12.5% revenue share needs to be US$8.6 billion or an additional US$3.2 billion. To place that in perspective, that’s 1.5 instances Guyana’s finances earlier than oil manufacturing started in December 2019.
If one remembers, the unique capital value for Liza Section 1 was US$4.4 billion, however after Guyanese oil skilled Dr. Mangal disputed a number of claims, the Consortium then decreased the fee by US$700 million. It was then decreased once more, to a ultimate quantity of US$3.5 billion. That’s an overstatement of expense by 26%.
There’s a sample right here of inflated bills. These monetary irregularities ought to set off fast investigation by any authorities, given the billions of US {dollars} at stake.
EDITOR’S NOTE: Darshanand Khusial is an govt OGGN Different govt members embody Alfred Bhulai, Andre Brandli, Janette Bulkan and Joe Persaud.
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