ExxonMobil rakes in $132 billion in Guyana profits
By Vishani Ragobeer
After about two decades of operating in Guyana, ExxonMobil, through its local affiliate Esso Exploration and Production Guyana Limited (EEPGL), recorded some GY$132 billion in earnings last year – the first time the company has recorded annual profits here.
For the year ending on December 31, 2021, EEPGL managed to accumulate GY$254.1 billion in revenues, essentially from the sale of oil produced in the Liza I field in the Stabroek Block offshore Guyana.
After spending about GY$122 billion on various costs, ranging from exploration and production costs to royalty payments to the government, the company recorded GY$132 billion in profits.
“This is the first year since our inception in 1999 that we generated profit in Guyana,” Phillip Rietema, the company’s Vice President and Business Services Manager, said on Wednesday during an engagement with members of the media.
The higher revenues were attributed to expanded production and higher selling prices.
Over the last two years, oil prices have been increasing due to numerous factors, including challenges stemming from the COVID-19 pandemic and more recently, the Ukraine/ Russia crisis. Simultaneously, ExxonMobil has expanded production in Guyana’s prolific Stabroek block.
Meanwhile, financial statements offered some breakdown of the monies spent.
According to the EEPGL’s profit/ loss statement, some $26.2 billion was spent on exploration activities. Another $26.2 billion was spent on production costs which, Rietema explained, includes the fines paid by the company for the excess flaring of natural gas.
Some $5.8 billion was also spent by EEPGL as royalty payments. These are payments made by companies for the production of oil and gas, separate from production costs and profits. And in 2021, the royalties paid were an increase of 184 per cent from 2020.
Though the company finally raked in these profits, Rietema also noted that the oil major has invested that amount and more to expand production in Guyana. Already, production has started in a second development field – the Liza II development.
Importantly, these figures in the financial documents reflect sums accumulated or spent by ExxonMobil, which is the operator in the Stabroek Block and holds 45 per cent interest there. It is separate from the 50 per cent profit oil share Guyana’s government collects.
Hess Guyana Exploration Ltd. holds 30 per cent interest, and CNOOC Petroleum Guyana Limited holds 25 per cent interest. These companies will be required to share their financial statements as well.
The financial statements were audited by TSD Lal and Co. chartered accountants.