Brazil government to probe Petrobras purchase of Texas refinery

14 March 2013 21:26  [Source: ICIS news]

MEDELLIN, Colombia (ICIS)--Brazil's federal accountability office (TCU) said on Thursday that it would investigate possible irregularities in the purchase of the Pasadena Refining System Inc (PRSI) by state-run energy company Petrobras.

The TCU said it would act on information submitted by public prosecutors alleging “damage to public finances” and “reckless management” during the deal with Belgium group Transcor Astra.

Petrobras bought a 50% stake in the Pasadena, Texas, refinery from Astra in 2006. Following a lengthy legal battle, Petrobras bought the remaining half from the Belgium company in July last year in a deal worth $820m (€631m).

According to the TCU, doubts remain over the “appropriateness” of payments made to Astra and the validity of technical studies that underpinned those payments.

Furthermore, there is evidence that the shareholders agreement between the two companies was detrimental to Petrobras’ interests because business risks were not shared, the TCU said.

“Faced with the gravity of the facts brought to light by prosecutors, and the nature of the resources involved, I considered an inspection appropriate,” said TCU minister Jose Jorge.

ICIS reported in November that Petrobras was planning to sell the 100,000 bbl/day refinery as part of the company’s $13.5bn divestment programme.

At the time, Petrobras declined to comment; however, the company had earlier said it was “evaluating various assets, including refining assets that are abroad".

Petrobras declined to comment on the TCU investigations.

By: Simon West

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