OKLAHOMA CITY, Oct. 14, 2021 /PRNewswire/ --
"Our conclusion regarding the payment of Taxes
claimed by our applicant is that THEY ARE ELIGIBLE."
– William
Delgado-Rodriguez, P.E., PA Technical
Assistance Contractor for FEMA
Mammoth Energy Services, Inc. (NASDAQ: TUSK) ("Mammoth" or the
"Company") today released an analysis from the Federal Emergency
Management Agency ("FEMA") Technical Assistance Contractor William
Delgado-Rodriguez that almost $62
million in Commonwealth of Puerto
Rico taxes prepaid in 2019 and required by Commonwealth
contracting law are "eligible" to be paid back to Mammoth Energy's
subsidiary Cobra Acquisitions ("Cobra"). These documents are
on the Mammoth website:
https://ir.mammothenergy.com/events-presentations. These taxes were
paid by Cobra in conjunction with work done to repair restore power
in Puerto Rico in the aftermath of
Hurricane Maria. This tax money is part of a larger sum of almost
$325 million PREPA continues to hold
in breach of its contractual payment obligations, without merit, as
of August 31, 2021.
Mammoth's Chief Executive Officer, Arty Straehla, commented:
"The men and women of our
Company performed outstanding work restoring the power in
Puerto Rico, but inexplicably
PREPA continues to breach their contractual obligations by not
paying almost $325 million for work
completed after Hurricane Maria. Even more egregious is that
FEMA officials stated back in 2019 that taxes we paid
to the Commonwealth in advance of being paid for work completed are
eligible to be paid back to us. But after almost two years
we've received nothing."
The Commonwealth of Puerto
Rico's contracting laws require applicants to submit all
costs and required fees and taxes in their bids.
Subsequently, based on an "accrual" accounting methodology when an
applicant wins a bid to do work in Puerto
Rico, the Commonwealth's tax code requires large taxpayers,
such as Cobra, to pay taxes to the Commonwealth in advance of being
paid for work done under the applicable contract(s). In
March 2019, $83 million in taxes were paid to
Puerto Rico for work done in
2018. PREPA continues to hold back almost $325 million in contractual obligated payments to
Cobra for work completed, as a part of this amount almost
$62 million is taxes that are no
longer obligated or owed to the Commonwealth.
Following Hurricane Maria (September
2017) in Puerto Rico and
its complete destruction of the island's power grid, Mammoth,
through Cobra, was awarded an initial $200
million reconstruction contract in 2017. Through five
separate amendments to the original contract, the aggregate
contract amount was eventually increased to $945 million. PREPA awarded a second contract of
$900 million to Cobra in response to
a Request for Proposals (RFP) process.
As of August 31, 2021, Mammoth,
through Cobra, is owed $325 million
including $98 million in interest
charges, as specified in the contract, on remaining invoices for
work it has already completed.
Mammoth Energy Services, Inc.
Mammoth is an integrated, growth-oriented energy services
company focused on the construction and repair of the electric grid
for private utilities, public investor-owned utilities and
co-operative utilities through its infrastructure services
businesses. The Company also provides products and services to
enable the exploration and development of North American onshore
unconventional oil and natural gas reserves. Mammoth's suite of
services and products include: infrastructure services, well
completion services, natural sand and proppant services, drilling
services and other energy services. For more information, please
visit www.mammothenergy.com.
Contact:
Mark Layton,
Chief Financial Officer
mlayton@mammothenergy.com
(405) 608-6007
Media Contact:
Peter
Mirijanian
peter@pmpadc.com
(202) 464-8803
Investors:
Rick
Black
rblack@dennardlascar.com
(832) 435-0026
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content:https://www.prnewswire.com/news-releases/mammoth-energy-releases-2019-email-from-fema-official-stating-almost-62m-in-commonwealth-taxes-prepaid-to-puerto-rico-by-cobra-in-2019-are-eligible-to-be-paid-back-301399911.html
SOURCE Mammoth Energy Services, Inc.