Mexico: Mexico’s Pemex cancels several Vitol contracts after graft scandal

Mexican state oil company Petroleos Mexicanos (Pemex) has cancelled three contracts with Vitol, the latest fallout from a U.S. bribery case involving the world’s largest independent energy trader.

Three separate Pemex documents were seen by Reuters and a source familiar with the matter provide as the reason for the cancellation Vitol’s public acknowledgement in December, in a deal with the U.S. Department of Justice, that it paid kickbacks to win business with the Mexican state oil company, as well as state companies in Brazil and Ecuador.

Pemex’s decision has not previously been reported.

In letters to Vitol (VITOLV.UL), all dated within the past two months, Pemex (PEMX.UL) informed the energy trader of the cancellation of a contract for butane gas, one for naphtha, and one for propane gas. The propane contract encompassed four separate deals.

The world’s largest independent commodity traders are facing scrutiny globally for alleged corruption after years of investigations into bribes of public officials in several countries in Latin America.

In March, Reuters reported that Mexico was looking to renegotiate some of its hundreds of millions of dollars worth of contracts with the Geneva-based company. Pemex CEO Octavio Romero Oropeza said it would jettison terms it considered unfavourable.

The original full article can be found at reuters.com

(Photo: REUTERS/Jose Luis Gonzalez)

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