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Guyana “vigilant” but not worried about impact of Chad’s US$76 billion fine on Exxon’s plans

ExxonMobil ‘s  fine of US$76 billion by a court in the northern central African nation of Chad earlier this month is not expected to affect plans by the American oil giant to begin commercial production in Guyana by 2020.

Minister of Natural Resources said it is clear that the company would have to earn money to pay the fine for alleged non-payment of taxes to Chad. The court has also demanded that the company pays US$819 million in overdue royalties.

“We saw with interest and it just reminded us that we have to be vigilant but, if at all, I believe that Exxon needs to find some money fast and it will spur them to continue developing the well (offshore Guyana) so that it can help them to pay some of their fines,” he told a news conference.

The Bank of Montreal has offered its services to Guyana to ensure that oil companies reveal all their figures to the Guyana government. “It is a lesson to learn and to give attention to and our concern is to ensure that we remain on track on the timelines that we set

Trotman expressed confidence that the Chadian court ruling would adversely impact on the company in Guyana. “I don’t believe it will interfere with operations here or cutback because if you have to pay a debt you have got to be able to earn to be able to pay so Guyana remains one of the view places where Exxon’s ability to earn exists so we don’t in anyway see then cutting back,” he said.

The record figure is almost five times Chad’s GDP of about $13 billion. The fine is the biggest ever imposed on an energy company, exceeding the $61.6 billion penalty against British Petroleum over the Gulf of Mexico disaster that killed 11 workers and left a spill of over 3 million barrels of oil.