US$700,000 contract inked for oil sector cost recovery audit

Last Updated on Tuesday, 24 May 2022, 14:43 by Denis Chabrol

A consortium of Guyanese auditors, backed by a specialised external entity, has been awarded a more than US$700,000 contract to conduct a cost recovery audit of the US$9 billion worth of transactions for the exploration and production of oil in the Stabroek Block, Minister of Natural Resources Vickram Bharrat said on Tuesday.

Mr. Bharrat said the consortium has been hired to audit transactions for 2018, 2019 and 2020 and validate Guyana’s profit oil share over the next four months.

Those awarded the contract are  Ramdihal and Haynes Chartered Accounting whose principals are Chateram Ramdihal and Floyd Haynes as well as Vitality Accounting.

Mr. Haynes, who recently obtained a licence from the Bank of Guyana to operate a merchant bank, thanked President Irfaan Ali and Vice President Jagdeo.

Permanent Secretary of the Ministry of Natural Resources, Joslyn Mc Kenzie and representatives of the auditing group, signed the deal during consultation with contractors and sub-contractors on Guyana’s Local Content regime.

Mr. Bharrat explained that originally, the auditing firm had proposed t0 do the audits for more than US$1 million but after negotiations, the offer was reduced to US$751,000. “Because we would have negotiated with the consortium and they would have also consulted with their international partners, we managed to bring it down,” he said when asked by Demerara Waves Online News.

The Natural Resources Minister said the Guyanese group of chartered accountants have partnered with the United States-based oil and gas consultancy, Martindale Consultants, with a view to being upskilled “so that they can gain that experience, they can gain the knowledge to do oil and gas audits.”

SGS Consultancy, which is specialised in the oil and gas sector, has also been contracted to assist the auditors. “Our local auditors might be very familiar with auditing basic expenses- fuel, meals, transportation- but when we are talking about jumpers and risers and FPSOs and these technical terms, obviously they will need that kind of technical knowledge and expertise on board to assist them to have a thorough exercise being done,” he said, adding that the company is specialised in subsea operations, equipment and exploration.

The Natural Resources Minister said the audit reports would be made public and also submitted to the Auditor General’s Office.

He dismissed reports in sections of the media that even if the audit uncovers discrepancies, Guyana would be unable to claim any losses from the ExxonMobil-controlled Esso Exploration and Production Guyana Limited.