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CORRUPTION-PERU: Officials Charged in Oil Contract Scandal

Ángel Páez

LIMA, Oct 22 2008 (IPS) - An anti-corruption Peruvian prosecutor brought charges against one current and three former high-level officials and 10 other people in a scandal over alleged bribes in lucrative oil contracts awarded to Discover Petroleum, a Norwegian company.

The charges filed by prosecutor Óscar Zevallos include corruption of public officials, criminal conspiracy and trafficking of influences. Judge Jorge Barreto immediately accepted the case.

The most prominent of the 14 defendants – Petroperu’s former president César Gutiérrez and former general manager Miguel Celi, and Perupetro’s current president Daniel Saba and former director Alberto Químper – were named to their posts by the administration of Alan García, who took office in July 2006.

(Petroperu is the state-run oil company involved in the transportation, refinery and commercialisation of fuel and other oil derivatives, while Perupetro is the government licensing body in charge of promoting investment in the oil industry and granting contracts to oil companies doing business in Peru).

The government has been severely shaken by the scandal, which led the entire cabinet to step down on Oct. 10. Although 10 of the 17 ministers were reinstated, the prime minister was among those who were replaced.

Among the evidence presented by the prosecution are recordings of telephone conversations between Químper and Rómulo León, a former lawmaker of the governing APRA party and former minister during García’s first term as president (1985-1990) who is now a representative of Discover Petroleum.

The defendants also include five other Perupetro officials, who carried out a "technical assessment" that led to the September decision to grant five oil contracts to Discover Petroleum.

The taped conversations indicate that Químper and León conspired so that the Norwegian firm would win the contracts and enter into a partnership with Petroperu.

Químper, the former director of Perupetro, who has strong ties to the governing party, was given that position when he failed to be elected to Congress.

Former Petroperu president Gutiérrez and Perupetro president Saba insist that the decision to award the contracts was transparent, and that there were no meddling or kickbacks of any kind.

But in the taped phone conversations, Químper and León can be heard discussing alleged payments that they were to receive from Discover Petroleum once the contracts were signed with the Peruvian state.

The deal was never actually finalised, however, because the tapes, dubbed "petroaudios" by the local press, were leaked to the media.

The suspicion that the recordings were illegally taped in a corporate spying operation by one of Discover Petroleum’s competitors has prompted another prosecutor to launch an investigation into who tapped the phones of the state oil officials and others during the eight month span from February to September.

Also facing charges filed by Zevallos are businessman Fortunato Canaán from the Dominican Republic and his Mexican associate Mario Díaz Lugo, who lobbied on behalf of Discover Petroleum in Peru.

Canaán hired León on the recommendation of members of the government.

In taped conversations between Canaán and León, the latter promised that the contracts would go to Discover Petroleum one way or another.

Executives from the Norwegian company, accompanied by Canaán, met twice with President García.

The "petroaudios" also indicate that León later had a falling-out with Canaán and became Discover Petroleum’s local lobbyist. In a letter published in the local press, Canaán complained that his former partner had betrayed his trust.

The prosecutors brought charges against Discover Petroleum employee Jostein Kjaerstad as well.

León, in hiding, sent a video to several local TV stations just before the charges filed by the prosecutor were announced. In the video, he says the "petroaudios" are not evidence of corruption and criticises García for publicly calling for his arrest before the courts issued an actual warrant and without giving him a chance to explain himself.

"The highest-level representatives of the government have jumped on the bandwagon, and the president himself has stigmatised me, which is deeply painful because it is unjust," said the former minister.

León also said he would turn himself in if the warrant for his arrest was revoked. Químper’s arrest has been ordered too.

In the "petroaudios", the defendants can be heard mentioning meetings and conversations with former prime minister Jorge Del Castillo and former energy minister Juan Valdivia, both of whom resigned on Oct. 10.

However, neither is facing charges, although they will be summoned to testify as witnesses.

Discover Petroleum said in public statements that the contracts were obtained in strict compliance with Perupetro’s technical requirements.

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