Entire Cabinet approved special account for Exxon bonus – Foreign Minister

Not all of the funds will go towards legal fees

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The entire Cabinet approved of the setting up of a special Foreign Currency Account to receive the US$18 million signing bonus from ExxonMobil and not all of it will go towards legal fees to settle the border controversy with Venezuela, Foreign Affairs Minister Carl Greenidge told the National Assembly Thursday morning.

However, he said that only those directly involved knew how the monies would be spent. Further, Mr Greenidge revealed that not all of the money would go towards paying an “enlarged” legal team to represent Guyana’s interest once the border controversy is referred to the International Court of Justice by the United Nations Secretary-General at the end of this year.

He said US$15 million would go towards legal fees and the other US$3 million would go towards urgent training for Guyanese in areas such as petroleum and geology.

The matter of the signing bonus with ExxonMobil has taken on scandalous proportions after it was revealed that one was in fact received despite denials by some government ministers.

The government was forced to admit to the bonus after a letter was leaked to the press showing that the instructions were passed to set up the account over a year ago.

But in the House today, the Minister of Foreign Affairs preferred to say that the facts were “straightforward” though pointing out the leak of the letter to the press “demonstrates just how porous our system is as regards confidentiality.”

He said that Guyana negotiated and received US$18 million in connection with the signing of a contract for the renewal of ExxonMobil’s petroleum license.

“Whether or not a contract was necessary is a matter of opinion on which I would waste no further time,” the Foreign Affairs Minister stated.

He said that while such payments are not unusual, there is no standard arrangement or formula concerning “either the quantum or the procedure for signing bonuses.”

Mr Greenidge declared that governments have negotiated with petroleum companies to be paid various amounts in light of evolving prospects of the sector or industry.

“During the course of 2015/2016, after discussions with ExxonMobil, the Minister of Natural Resources proposed to Cabinet that the payment of a bonus on the extension of an agreement by the company, be undertaken; Cabinet agreed,” Mr Greenidge stated in the National Assembly.

He added: “On June 7, 2016, the Minister duly reported that the negotiations had been concluded. The full Cabinet approved the terms negotiated and the arrangements to receive the funds on that date.”

According to Mr Greenidge, “given the importance for which the funds were to be used and its implication for national security, neither the President nor the Minister saw any merit in advertising the matter.”

“In fact, so great was the concern that only those that needed to know were informed as to the purpose of the deposit,” the Minister further stated.

Mr Greenidge said there was nothing secret since many agreements are made without announcement.

Regarding questions about the decision not to deposit the funds into the Consolidated Fund, Mr Greenidge said the intended use of funds received by the government usually determines how they are passed through the government accounts. He said that that aspect does not normally attract the attention of Cabinet.

Mr Greenidge said that both he and the Minister of Finance advised that the funds be kept separately to pay legal fees on the border issue.  He emphasised that only those members of Cabinet directly involved and the relevant technicians were informed.

According to the Foreign Affairs Minister, the funds would be paid into the Consolidated Fund at the “appropriate time” and that this is provided for in the Fiscal Management and Accountability Act.

President David Granger on Wednesday said that the decision to place a US$18M signing bonus received from ExxonMobil into a separate bank account instead of into the Consolidated fund “was the thing to do…at that point in time,” as he took full responsibility for the transaction.

“I am the Head of Government; I am responsible and I am aware of it and it is a legitimate Government of Guyana exercise and I am aware that it is in the Bank of Guyana is Escrow which means it cannot be used for the purpose it’s not intended,” Mr Granger said.

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