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Brazil Prosecutors: Charges Pending over Ensco Drillship Lease

Maritime Activity Reports, Inc.

August 7, 2015

Brazilian prosecutors plan to file criminal charges stemming from the lease of an Ensco Plc offshore oil-drilling ship to Brazil's state-run oil company Petrobras "in due course," they said.
The plan to prosecute over the Ensco-Petrobras charter was mentioned in a Thursday statement presenting corruption charges stemming from the 2009 lease of another drillship, Vantage Drilling's Titanium Explorer Rig.
In the Vantage case, prosecutors formally charged six people, including Petrobras' former international-unit chief Jorge Zelada.
Petroleo Brasileiro SA, or Petrobras, chartered the DS-5 in 2008, when it was owned by Pride International, a company London-based Ensco purchased in 2011.
Prosecutors say more than a dozen international firms may have paid bribes to former Petrobras executives, part of a massive scheme of price-fixing and political kickbacks.
Charges filed on Thursday against Hsin Chi Su, chief executive of Taiwanese shipping firm TMT, emphasize the increasingly global nature of what is now thought to be one of the largest corruption cases in the world.
Prosecutors first mentioned irregularities about the Titanium Explorer DS-5 contracts in July when Zelada was arrested.
Since then, plea-bargain testimony from lobbyist Hamylton Padilha pointed to the existence of "a grand scheme of corruption and money laundering involving multinational executives, lobbyists and financial operators to pay bribes to corrupt Petrobras officials," prosecutors wrote on Thursday.
Padilha and Su were among the six people charged on Thursday with orchestrating a $31 million bribe to seal the Vantage contract with Petrobras. Neither could be reached for comment.
An internal Petrobras audit also detected irregularities in the drillship contracts, prosecutors said.
Vantage did not respond to request for comment but said in a July 30 statement it had not been able to confirm if Padilha was cooperating with Brazilian investigators. If he had committed any illegal acts, he was not acting on behalf of Vantage, the company said.
An Ensco spokesman referred Reuters to comments from Ensco CEO Carl Trowell, who said on July 30 the company took reports of improper activity by former Pride employees very seriously and had conducted compliance reviews, audits and independent investigations in light of developments in Brazil.
Ensco has not been contacted by Brazilian authorities, Trowell said, and the company "respectfully disagreed" with allegations of overpayments on the DS-5 drilling services contract.
Alexandre Lopes, a lawyer representing Zelada, said on Friday the charges were "absolutely unfounded." Zelada ran Petrobras' international division from 2008 to 2012.
(Reporting by Caroline Stauffer; Editing by Phil Berlowitz)

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