GRA to audit ExxonMobil

first_imgThe Guyana Revenue Authority (GRA) has announced plans to audit ExxonMobil’s operations and is making all the necessary preparations to ensure that Guyana gains its rightful share of taxes from the annual production of oil and gas, GRA Commissioner General, Godfrey Statia has said.Statia revealed that this will happen soon, as the GRA is already in the process of establishing an oil and gas unit which will be staffed by over 100 persons from both here and abroad. According to him, the country is expected to earn millions of United States (US) dollars annually from oil production.The Commissioner General said ExxonMobil has been duly informed of the plans. He said the audits would focus not only on revenues but also on expenses, assets and other issues as the need arises. “You don’t have to be on the well measuring barrel by barrel to do a proper audit on any oil company. There is adequate software and you could trace the funds all over the world,” he explained.In addition to that, the GRA boss noted that the Authority plans to maximise the opportunity of gaining taxes. As such, audits would also be extended to ExxonMobil contractors. “When we are looking at oil and what we get from oil, we don’t look to see the taxes that we are going to get from contractors, the economic activities we will get from mid-stream activities,” Statia added.He made reference to reports about oil companies in neighbouring Trinidad and Tobago allegedly evading withholding taxes to the tune of US$200 million annually, through inter-company transfers within the Region. “I would like to say that if that occurs here, it would not be under my watch. It means that the tax officers were not doing their jobs properly,” Statia said, while emphasising the need for vigilance.According to him, many oil companies have been part of inter-company transactions since the 1970s. He said it therefore requires a competent team of auditors to curtail these activities. While admitting that there is a limited pool of people who could go after additional taxes, the GRA plans to equip the staff to respond to this new sector in an efficient manner to find additional taxes.The Commissioner General also revealed that based on certain estimates, Guyana could earn as much as US$700 in the first year of oil production. As such, he stressed the importance of having adequately-trained persons and the need for a technically diversed staff as well to work in the unit.Some eight persons will be sent to England to pursue studies in oil and gas. Local training which starts on Monday will be facilitated by a technical assistance group from the US which comprises retired Internal Revenue Service (IRS) officers. IRS is the revenue service of the US Federal Government.“In the first instance, we are going to be training internal persons to give them a chance and so those internal persons would begin training from next week. There are certain technocratic positions that we cannot fill such as persons who are fully into petroleum audit and accounting,” he stated.Furthermore, several GRA staff will be heading to Trinidad soon to be trained. The Government has also set aside US$2 million for training in the area of oil and gas. This is in addition to the 10 GRA officers already being trained on board ExxonMobil’s vessels.In a report done on the oil sector last year, the IMF had urged the Guyana Government to start as soon as possible auditing all exploration and development costs being racked up by ExxonMobil.When he presented the 2018 Budget last year, Finance Minister Winston Jordan had alluded to the impending establishment of an oil and gas unit at the GRA. The IMF had said establishment of this unit should become a priority of the Government.“It will be important for this unit to start verifying and undertaking audits of cost incurred during the exploration and development phase, which is getting underway now. It would be advantageous to establish close working relations between the GRA and the sector regulators, to ensure that the limited petroleum sector expertise in Government is applied most efficiently,” the IMF had stated in its report.last_img

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