Two traders vying to market Guyana’s crude banned by Mexico over fresh corruption allegations

Aug 24, 2021 News

– Corrupt companies should not be here –Mexico’s Energy Minister

Kaieteur News – Guyanese evaluators are currently reviewing bids from 15 companies, which are interested in marketing the country’s next lift of one billion barrels of Stabroek Block oil, which is due in September. But two of the traders on that list were on Sunday banned from receiving new work in Mexico. The ban came on the heels of fresh corruption allegations. The two global traders in question are: Vitol Group and Trafigura Group.

Mexico’s Energy Minister, Rocío Nahle.

Though Mexico has not released the details of the new corruption charges, its Energy Minister, Rocío Nahle said both companies would remain under the ban until 2024 while the government reviews the conduct of other oil operators and traders. The Mexican government has also declared that it will suspend work with any company found to have committed wrongdoing.
In recent years, the world’s most powerful commodity traders have faced bribery and corruption investigations in a worldwide crackdown that has spanned jurisdictions from the US and Switzerland to Brazil and Mexico. Lopez Obrador swept to power on pledges to revive Mexico’s state oil giant to its former glory and reduce the influence of private energy operators that he often characterised as corrupt. In agreement with his line of thinking is Nahle, Obrador’s longtime ally and Chair of Mexico’s state owned oil company, Pemex. Just last Thursday, Nahle told Mexican press, “Those who are carrying out corruption shouldn’t be in Mexico,” while adding, “We are working to leave a country with good practices.”
Trafigura was keen to note that it sees no basis for new business to be suspended, while adding that its compliance policies and procedures have been fully reviewed and found by an independent external counsel to meet the highest standard required by law across all jurisdictions in which Trafigura operates. It also strongly refuted any allegation or suggestion of corruption.
Representatives from Vitol did not immediately respond to requests for comment by Bloomberg and other foreign press members. In the past however, Vitol has said it is committed to upholding the law and has anti-bribery and anti-corruption policies, procedures and controls across its business activities.
Those statements have been deemed questionable by industry stakeholders since in December last year, Pemex’s trading arm PMI had suspended new business with Vitol. The firm had agreed to a US$160 million settlement over charges that it plotted to pay bribes in Brazil, Mexico and Ecuador. The allegations included bribes paid to Pemex officials. The government and the Mexican producer have launched their own investigation into Vitol on this matter.
The other companies, which have submitted bids to market Guyana’s crude, include western oil majors such as Royal Dutch Shell, Chevron Corp, France’s Total Energies SE and Norway’s Equinor ASA. Hess Corporation, a partner in the consortium that operates the oil rich Stabroek Block, submitted a bid, while lead partner ExxonMobil did not.
Other companies submitting bids included, commodities trading houses like Mercuria, as well as, units of Saudi Arabia’s Aramco and China’s Sinochem.
The proposed commissions ranged from two cents per barrel in the case of Sinochem, to 26 cents per barrel in the case of a joint bid submitted by the National Gas Company of Trinidad and Tobago, and Trinidad-based Heritage Petroleum Company Limited.