Experts say Senegal could have gained US$ billions through competitive bidding of gas fields

Oct 15, 2020 News

Kaieteur News – No one in their right mind would want to sell a property for way less than it is worth and allow the buyer to make a million times more in profits after selling it again.

Expert on Oil Sector Corruption, Alexandra Gillies

Aliou Sall, the brother of Senegal’s President

President of Senegal, Macky Sall

Controversial businessman, Frank Timis

With this fundamental reasoning in mind, expert on oil sector corruption, Alexandra Gillies, categorically states that civil society activists should always be alarmed when governments allow prime assets to be given to unqualified companies for nothing, as opposed to going through a competitive bidding process which would garner billions of dollars in revenues for the citizenry.
In a detailed analysis that was published by the Natural Resource Governance Institute (NRGI), Gillies cited the case of Senegal which gave two of its prime gas blocks to a crooked businessman for free. He later sold both offshore concessions for billions of dollars in profits that will fill the pockets of his children and grandchildren for life.
Gillies said that Frank Timis, a Romanian-Australian businessman with a corrupt past and no experience in offshore exploration, created a company called PetroTim in 2012 and registered same in the Cayman Islands. After creating that company, Gillies noted that he used it to gain the rights to two offshore concessions, Saint Louis and Cayar, the same year.
Two years later, he created another shell company called Timis Corporation, registered same in the British Virgin Islands, and hired the brother of the Senegalese President, Aliou Sall, to run the show. It is important to note that the President’s brother also has little to no experience in deep water exploration and production.
Less than two months after registering the new company and hiring the President’s brother, the company started selling out the interest in the gas fields as it lacked the finances to do honour to the exploration programme.
Gillies noted that Timis Corporation sold 60 percent of the shares to American oil company Kosmos in 2014 for over US$400M. That same year, Kosmos found major natural gas reserves. The United Kingdom (UK) oil giant British Petroleum (BP) subsequently joined the partnership and acquired 30 percent of the blocks’ interest which saw Timis getting more than US$200M.
In 2017, BP then bought out Timis Corporation for US$250M. That company had held the remaining shares in the gas blocks. BP also agreed to pay Timis at least US$12B in royalties over a 40-year period. In total, Timis made approximately US$900M in cash within five years of acquiring the blocks and today, the 55-year-old is set for life with at least US$12B more to follow.
Taking the foregoing into consideration, Gillies categorically stated that an open and well-run competitive tender would have attracted a capable company to explore the blocks. She said that when governments decide to go another route, it should always arouse suspicion and be investigated. Gillies added that when a probe is done, there is oftentimes an element of corruption that would be detected.