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Brazil agency opens probe of SBM-Petrobras oil-ship contracts

by Reuters
Friday, 4 April 2014 21:22 GMT

RIO DE JANEIRO, April 4 (Reuters) - Brazil's controller-general has opened an investigation into the lease by SBM Offshore NV, a Dutch company, of oil production ships to state-run oil company Petroleo Brasileiro SA , widening a probe into allegations of bribery by SBM.

In February, allegations from a former SBM employee came to light suggesting SBM paid $250 million in bribes, with $139 million of that paid in Brazil.

The investigation by the controller-general, known as the CGU, follows an investigation at Petrobras. The internal Petrobras probe found no evidence of wrongdoing.

The CGU announced its probe Wednesday in a statement in the Diario Official, Brazil's publication of official news. The announcement made no mention of Petrobras or SBM.

"The Petrobras investigation was well done, especially if we consider the restriction of having to complete their work in 45 days," Jorge Hage, head of the CGU, said in a statement. "The final Petrobras report will be useful as a starting point for our work."

Petrobras also faced limits on how and where it could investigate because its legal powers are limited, he said.

The CGU investigation, which will take 30 days, adds to growing pressure on Brazil's government over alleged mismanagement and bribery at Petrobras, where Brazilian President Dilma Rousseff was chairwoman of the board of directors from 2003 to 2010.

Opposition politicians have seized on alleged cost overruns at Brazilian and U.S. refineries and on the SBM case to attack Rousseff's record as an administrator ahead of the October general elections.

Lawmakers have obtained signatures from a sufficent number of legislators to install a formal probe. They have also set up a panel to accompany investigations of the SBM-Petrobras case.

The SBM probe began nearly two years ago. At the time, executives of the company, the world's largest leaser of floating oil production ships, known as FPSOs, discovered evidence that officials may have paid bribes to representatives of two West African countries and one, then unnamed, country.

Eight of SBM's 17 FPSOs are in Brazil, where it also has three onshore bases and a shipyard.

SBM informed Dutch, British and U.S. officials of its probe in 2012, and those countries have opened investigations into the bribery allegations. The CGU has already consulted with both countries on the issue, the CGU press office said.

In March, Brazil's Federal Police said it was opening its own investigation.

The case is Administrative Process No. 00190.003151/2014-33 of the Controller General of Brazil (CGU). (Reporting by Jeb Blount; Editing by Leslie Adler)

Our Standards: The Thomson Reuters Trust Principles.

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