State has three opportunities to peruse and challenge expenses of oil companies

I read in the last Sunday Stabroek that Dr. Mark Bynoe, Head of the Department of Energy, has said that his first task is to find an international company to assist the GRA and the Auditor General to examine the oil companies’ costs submissions.

Editor, I was shocked to have read that statement attributed to Dr. Bynoe.

Dr. Bynoe has had his supporters and detractors writing in the media regarding his appointment. I had reserved my comments. However, his statement shows his lack of readiness for such a high office.

As far as I understand it, the Department of Energy (DoE), would look after the government’s business as a partner and a licenser with the oil companies. In the first instance the GRA’s mission is to examine the expenses of the taxpayers (whether that tax payer is private or government). It would thus be a conflict of interest for the taxpayer (govt) to provide to GRA an accountant to examine the taxpayer’s returns.

Another and more fundamental error in Dr. Bynoe’s statement is looking for a company to assist the Auditor General’s Office (AGO). The AGO is a constitutional and independent office. It reports directly to Parliament, and the laws provide for the AGO to determine who it wants to farm audits out to. In fact, the DOE would be audited by the AGO and it would be highly irregular for the AGO to accept any such service from a Ministry or Department which it must audit. Dr. Bynoe is out of his authority here. You are not on the mark, but you are dead wrong Mark!

The state has three opportunities to peruse and challenge the expenses of the oil companies.

First the DoE has to have its own accountants to look at these submissions before they are sent with the returns to the GRA. The government (DoE) has a contract with Exxon and that is in the contract between the government and the oil company. The Government has to have its own accountants to determine the legitimacy of all the expenses which will be submitted to it by the oil companies. In fact, that article in the contract between the oil company and Exxon re the time period to examine the financials of Exxon, only applies to these two contractors.

Secondly, GRA has its own laws as pertaining to tax returns. I stand to be corrected but I haven’t heard of any contract between GRA and Exxon. GRA can audit you anytime and can go back up to seven years. GRA can and must hire or retain specific expertise to deal with the submissions from the oil companies and their state partners

Thirdly, the AGO has to audit the DoE and the Ministry of the Presidency. In so doing it has the constitutional duty to request and audit any and everything. Parliament must provide the resources to the AGO to execute its work.

It is so inconsistent, that the Government voted down an increase in the allocation to the AGO which had applied for funds in the 2018 budget to establish the capacity to audit the oil and gas expenses. Now Dr. Bynoe is arrogating the responsibility to the DoE for providing the company to assist the AGO.

Thus we can have three agencies assisting us. Such would provide for checks and balances.

On another note, I see Exxon being very generous with donations, (UG, CI, sponsorship). These are not oil related expenses. They are expenses relating to image building and branding for Exxon. I bet once we start to challenge such items you will see how quickly this free-handed generosity of Exxon will disappear. I challenge our examiners of the oil expenses to separate Exxon’s PR expenses from the expenses for the development of the oil.

Yours faithfully, Manzoor Nadir