Petrofac pleads guilty in bribery case
London-listed oil services firm Petrofac has reached a deal with the UK's Serious Fraud Office (SFO), agreeing to plead guilty to bribery charges involving several major oil and gas engineering projects across the Mideast Gulf.
Petrofac entered guilty pleas to seven counts of "failing to prevent former Petrofac group employees from offering or making payments to agents in relation to projects awarded" in Iraq, Saudi Arabia and the UAE, the company said today.
A sentencing hearing, to determine a financial penalty, is scheduled to take place at Southwark Crown Court on 27 September.
The company is seeking to draw a line under the bribery incidents which took place between 2012 and 2015, and a four-year probe by the SFO.
"This was a deeply regrettable period of Petrofac's history," Chairman René Medori said. "We are committed to ensuring it will never happen again. We have fundamentally overhauled our compliance regime, as well as the people, and the culture that supports it."
The company's former head of sales David Lufkin is also due to be sentenced on Monday, relating to 14 counts of bribery covering contracts wroth around $7.5bn.
Petrofac has already faced consequences in the projects market. In March, Abu Dhabi's state-owned Adnoc banned Petrofac from competing for new contracts. Adnoc has said it will periodically review its exclusion order.
This included the termination of Petrofac's $1.5bn contract for facilities at the offshore Dalma sour gas field which would have added 340mn f3/d ((9.62mn m3/d) of gas for domestic consumption. Due for completion in 2022, the project was a key part the UAE's goal of gas self-sufficiency by 2030.
Abu Dhabi's ban has left Petrofac with a $15bn hole in its bidding pipeline, adding to the impact of the Covid-19 pandemic which disrupted project schedules, increased costs and delayed new contract awards, the company said in its 2020 annual report published in April.
Related news posts
US court asked for third Citgo auction extension
US court asked for third Citgo auction extension
Houston, 19 September (Argus) — The court-appointed special master overseeing the auction of US refiner Citgo has asked the court to delay the announcement of a successful bidder to 26 September and a sale hearing to December. Special master Robert Pincus planned to make an announcement of the proposed buyer on or about 16 September followed by a November sale hearing, but last minute legal challenges derailed what have otherwise been "robust negotiations with a bidder," according to a court filing today. "The special master is continuing to negotiate sale documentation with a bidder," today's motion said. Pincus previously requested a second extension in August and a first extension in late July . By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Small private Libyan firm exports oil through blockade
Small private Libyan firm exports oil through blockade
London, 19 September (Argus) — A small Libyan private firm appears to have been granted an exemption from an oil blockade, which has more than halved the country's exports. Arkenu Oil, which describes itself as a private oil and gas development and production firm, is scheduled to export 1mn bl of Sarir and Mesla crude from Marsa el-Hariga to Italy's Trieste on the Maran Poseidon, according to an official document seen by Argus . The tanker has been chartered by Turkish trader BGN and is currently loading its cargo. This is the first Arkenu shipment set to be exported since the country's eastern-based administration ordered a blockade on oil fields and terminals on 26 August in response to an attempt by its rival administration in the west to replace the central bank governor. It is also Arkenu's third known shipment since July. Arkenu exported a 1mn bl cargo on the Zeus on 10 July and another 1mn barrel cargo on the Yasa Polaris on 16 August, according to official documents and ship-tracking data. These were also Sarir and Mesla grade. Arkenu's exports are significant given that crude sales have historically been the preserve of NOC and a handful of international oil firms that hold stakes in the country's upstream such as Eni, TotalEnergies and OMV. Arkenu, which is based in the eastern city of Benghazi, is supposedly able to export its own crude based on an agreement with NOC which allocates it an unspecified share of production from its subsidiary Agoco's Sarir and Mesla fields in return for carrying out work to boost output at the sites. But there remain questions related to the legality of the deal, the nature of the work Arkenu is supposed to be carrying out and the company's technical capabilities. The three known Arkenu cargoes are worth around $240mn at prevailing market rates, Argus estimates. There has been no increase to Agoco's production capacity since the Arkenu deal was struck, one Libyan oil industry source said. Sarir and Mesla accounted for most of Agoco's roughly 280,000 b/d output in 2023. Arkenu and NOC have yet to reply to a request for comment. "The Haftar family is deliberately and selectively allowing crude exports that generate dollars outside the Libyan state, and they are doing so within the context of a blockade they imposed," said Jalel Harchaoui, a Libya specialist at the UK's Royal United Services Institute. "While the Libyan state struggles to figure out how to import food and medicine next month owing to the central bank crisis, the Haftars' strange oil blockade permits crude exports that profit a private Libyan entity," Harchaoui added. The leadership crisis at the central bank has degraded Libya's ability to carry out international financial transactions. "The only beneficiary from these Mesla and Sarir sales is an unknown private Libyan company with an account in Switzerland and the UAE, with zero dollars being deposited in the state," the oil industry source added. General Khalifa Haftar's Libyan National Army (LNA) controls the country's east and southwest and is the real force behind the blockade. Haftar is understood to be allowing some exports to continue as long as these revenues do not reach the central bank in Tripoli, which is controlled by the rival administration in the west. Libya's crude exports have averaged 410,000 b/d so far this month, according to Kpler. While this is well below pre-blockade levels of around 1mn b/d, it is well above levels seen in some past blockades. Rising exports in recent days suggests Libya's total crude production has picked up from an earlier Argus estimate of around 300,000 b/d to possibly around 500,000 b/d. Libya was producing 1mn b/d before the blockade. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Citgo auction result delayed amid last-minute motions
Citgo auction result delayed amid last-minute motions
Houston, 18 September (Argus) — The US court-appointed special master overseeing the auction of US refiner Citgo plans to object to a last-minute motion from the Venezuelan government to delay the sale process by four months. The Republic of Venezuela and state-owned oil company PdV filed a motion on Tuesday seeking a four-month pause in the sale of its refining subsidiary Citgo, which is being auctioned off to satisfy debts owed by PdV. Special master Robert Pincus said in a court filing today that he intends to object to Venezuela's motion for a pause. The last-minute motion from Venezuela comes days after the US District Court for the District of Delaware was expected to announce results of the winning bidder. The court asked for a second extension to the auction process in August, delaying announcing a successful bidder to on or about 16 September with a sale hearing on 7 November. But Pincus is now dealing with last-minute legal challenges filed last week outside of the Delaware courts by so-called "alter ego" claimants seeking to "circumvent" the Delaware court's sales process and "jump the line" for enforcing claims against PdV, the special master said in a filing last week. Bidders for Citgo's 804,000 b/d of refining capacity, terminals, retail fuel stations and other plants expect the assets to be sold free and clear of future claims by PdV creditors. Unresolved legal liabilities could lower the value bidders are willing to pay for Citgo, decreasing the pool of money available to those owed by PdV. By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US seeks to purchase 6mn bl for SPR
US seeks to purchase 6mn bl for SPR
Washington, 18 September (Argus) — President Joe Biden's administration is trying to purchase 6mn bl of sour crude for delivery to the US Strategic Petroleum Reserve (SPR) as part of a plan to issue solicitations when prices are "favorable for taxpayers." The US Department of Energy (DOE) today released a solicitation to purchase up to 6mn bl of sour crude for delivery in February-May to the SPR's Bayou Choctaw site in Louisiana. If the purchase is successful, it would be the largest single purchase since the Biden administration launched its crude purchase program in early 2023. The solicitation offers a chance for the administration to buy crude for the SPR at a lower price than earlier purchases. Nymex WTI crude futures for delivery in February settled at $68.41/bl on Tuesday. The lowest-priced crude purchase under Biden was a 1.7mn purchase at a price of $72/bl in June 2023, and the average purchase price is about $76/bl. Bids for the solicitation are due by noon ET on 25 September. DOE has already purchased more than 50mn bl of sour crude for the SPR, of which 30mn bl have already been delivered. On 9 September, DOE said it purchased 3.42mn bl of sour crude for the SPR's Bryan Mound storage site at a price of $72.46/bl from the trading firm Macquarie Commodities Trading. The crude will be delivered in January-March, adding to an earlier purchase of nearly 2.5mn bl that will be delivered to the Bryan Mound site over the same time frame. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more