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GEORGETOWN, Guyana, Jun 9, CMC – ExxonMobil Tuesday said it had accumulated US$489.5 million as negotiations continue with the Guyana government on a decommissioning fund for the safe removal of equipment and sealing of depleted wells.
“Talks are underway between ExxonMobil, Guyana Limited, as well as the government, on what the terms and conditions of that fund might look like,” ExxonMobil Guyana’s Vice President and Business Services Manager, John Colling, told a news conference.
The US$489.5 million has been listed as “asset retirement obligation” in the 2025 financial statement that was submitted to Guyana’s Corporate Registry. The money covers the balances for the period 2023, 2024 and 2025.
Colling told reporters that there was no timeline for completing the negotiations but described the talks as “very productive” and that the oil and energy company wanted an agreement on the decommissioning fund that would be investor-friendly.
“Ultimately what we’re looking for is a fund that is consistent with the Petroleum Act as well as international best practices that ultimately provides the financial assurance required by the government of Guyana and is also industry best practice to encourage future investors to continue to do business here in Guyana,” he said
Colling said consistent with his company’s 45 per cent stake in the Stabroek Block, the American company would contribute that amount to decommissioning costs. China National Offshore Oil Corporation (CNOOC) has a 25 per cent stake and Chevron (formerly Hess’ stake 30 per cent.
Meanwhile, the two parties have still not reached an agreement on a Sole Expert to resolve the dispute over the US$214 million in questionable expenses claimed by the oil giant.
An audit conducted by IHS Markit, which was acquired by S&P Global, had found that of the US$1.67 billion in claims made by the oil company for operational expenses in the Stabroek Block for the period 1999-2017.
The Sole Expert is expected to determine whether the US$214 million in questionable expenses as flagged by IHS Markit were legitimate.
But after more than a year of agreeing to the process as provided for in the Stabroek Block Production Sharing Agreement (PSA), the government, at the level of the Guyana Revenue Authority (GRA), and ExxonMobil, have not reached an agreement despite nominations from both sides.
“I can assure you that ExxonMobil Guyana Limited as well as the government is diligently working to find a sole expert which is acceptable to both parties,” he told reporters, adding that the two sides are still locked in discussions regarding the selection of the Sole Expert.
“What I can tell you is that as sole experts are considered they must meet a number of qualifications that are acceptable to both parties, and certainly objectivity is one of them. So, that is one of the criteria that we are discussing with the government as well as experience, relevant experience which is another key factor,” the ExxonMobil Guyana Vice President said.
Colling, however, declined to disclose how many nominees Exxon has put forward to date, adding that should the two sides fail to reach an agreement on the Sole Expert, one would be appointed by the International Chamber of Commerce (ICC).
“The process is outlined very clearly in the petroleum agreement. So the parties in this case, ExxonMobil Guyana Limited and the Government have looked at different sole experts for potential selection. If we are unable to arrive at a mutual selection that can be referred to the ICC to make the selection, which very well maybe the next step in the process,” Colling said.
Exxon has long maintained that it intends to recover the entire US$1.678 billion in costs for exportation work done between 1999 and 2017.
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