$US18M oil bonus: Opposition MP files legal challenge to have monies deposited into Consolidated Fund

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Opposition People’s Progressive Party (PPP), Member of Parliament, Anil Nandlall, who is also the former Attorney General and Minister of Legal Affairs today filed a legal challenge against the Government over its move to withhold the $US18M signing bonus, which it received from ExxonMobil, from the Consolidated Fund.

Applicant: Former Attorney General Anil Nandlall

A hearing is fixed for the March 13, before the acting Chief Justice, Justice Roxane George-Wiltshire at 1:30pm.

The respondents in the case are listed as the Attorney General, Basil Williams and the Minister of Finance, Winston Jordan respectively.

Nandlall in his challenge outlined that that Article 33 of the petroleum agreement signed between the Government and Esso Exploration and Production Guyana Limited, CNOOC Nexen Petroleum Guyana Limited and Hess Guyana Exploration Limited, confirms that ExxonMobil paid US$18M as a signature bonus to a bank account within the Bank of Guyana (BoG), which is owned by the Government as designated in writing by the Minister of Finance.

However, the Opposition MP is contending that the Constitution and the Fiscal Management and Accountability Act (FMAA) makes provisions for the signing bonus to be placed into the Consolidated Fund.

Attorney General & Minister of Legal Affairs Basil Williams, has been named as the first respondent

In his application for the US$18M to be deposited into the said Fund, Nandlall made reference to Article 216 of the Constitution and Section 38 of the FMAA.

Article 216 of the Constitution provides that “All revenues or other moneys raised or received by Guyana (not being revenues or other moneys that are payable, by or under an Act of Parliament, into some other fund established for any specific purpose or that may, by or under such an Act, be retained by the authority that received them for the purpose of defraying the expenses of that authority) shall be paid into and form one Consolidated Fund”.

While Section 38 of the FMAA, Chapter 73:02, provides: “(1) All public moneys raised or received by the Government shall be credited fully and promptly to the Consolidated Fund, except— (a)  moneys credited to an Extra budgetary Fund as stipulated in the enabling legislation establishing that fund; (b) moneys credited to a Deposit Fund; and (c) as stipulated in the Constitution.”

According to Nandall in his application, the $US18M signing bonus falls within “the category of “revenues or other monies” contemplated by Article 216 of the Constitution as well as “all public monies” contemplated by Section 38 (1) of the Fiscal Management and Accountability Act, Chapter 73:02, and accordingly, must be credited fully and promptly pay into and form one Consolidated Fund.”

Moreover, his application noted further that the $US18M deposited into an account established by the Minister of Finance within the BoG and kept there without depositing same into the Consolidated Fund is in “breach of and contrary to, the letter and spirit of Article 216 of the Constitution of the Republic of Guyana and Section 38 (1) of the Fiscal Management and Accountability Act, Chapter 73:02.”

The existence of this bonus and the renegotiated oil agreement with the company was kept a secret until evidence of the transaction was leaked in December 2017.

After mounting criticism, President David Granger defended the transaction by saying it was the thing to do at the time.

Government subsequently defended its move not to deposit the singing bonus into the Consolidated Fund by saying that it was holding the money to pay legal fees for Guyana should it have to take its border case with Venezuela to the International Court of Justice (ICJ).

Head of Transparency Institute of Guyana,Dr Troy Thomas, also took the government to court in his private capacity to have the $US18M transferred into the Consolidate Fund.

However, because of a procedural error, Thomas and his attorneys will have to file a new application.

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