A five-month thorough investigation conducted into the award of a $5million service contract towards the construction of the Jubilee Field production vessel, FPSO Kwame Nkrumah, has established that there was neither corruption nor bribery in the award of the contract by Mitsui Ocean Development & Engineering Company Ltd (MODEC).
\nA terse statement issued by MODEC last Sunday, states that an independent investigation commissioned by its Board into its service agreement with its contractor – Strategic Oil and Gas Resources Limited – (StratOil), at the instance of prospective equity partners in the Jubilee FPSO, could not establish that any laws were violated.
\nA former Chief Executive of the Ghana National Petroleum Corporation (GNPC),
\nTsatsu Tsikata, is reported to have an interest in StratOil.
\nThe International Finance Corporation (IFC), a member of the World Bank Group,
\nin July last year raised an alarm over a $5million service contract between MODEC and StratOil in connection with the award of the contract for the construction of FPSO Kwame Nkrumah M.V. 21 in 2008.
\nAs a result of the concerns raised by the IFC and its request for a due diligence, the Multilateral Investment Guarantee Agency (MIGA) suspended a $225 million political risk guarantee (insurance) it was about to provide for the prospective equity partners.
\nThe prospective equity partners were seeking to invest in MODEC\u2019s wholly-ownedNetherlands-registered subsidiary, Jubilee Ghana M.V. 21, which owns the Jubilee
\nfloating, production, storage and offloading vessel, FPSO Kwame Nkrumah M.V. 21. MODEC states that the thorough inquiry, conducted into the matter by a well recognized law firm with specialty in such matters, \u201chas found no evidence of any violation of the U.S. Foreign Corrupt Practices Act or any other applicable jurisdiction’s anti-bribery laws in relation to its arrangement.\u201d
\nMODEC, on July 29th, 2010 announced through a press release that MIGA was suspending its guarantee for the Jubilee FPSO, a statement which was widely misconstrued to mean the withdrawal of physical insurance cover on FPSO Kwame Nkrumah.
\nAn official statement issued by Stuart Sutton-Jones, Corporate Affairs Executive of StratOil at the time the news about the MIGA suspension and insinuations of possible graft welcomed the due diligence indicating it had already given permission to MODEC to disclose details of their confidentiality agreement.
\nMr. Sutton-Jones revealed in his statement that StratOil, provided advice and consulting services to MODEC for the preparation of their tender that won the bid to supply an FPSO to the Jubilee consortium and related services.
\nHe said StratOil rendered very extensive services to MODEC, which included recommending the use of financing from the International Finance Corporation (IFC) as well as African Development Bank, AfreximBank, US Overseas Private Investment Corporation (OPIC), and the African Finance Corporation (AFC).
\n\u201cIt was stratOil who also introduced MODEC to equity providers in the Middle East and carried out extensive economic modeling work for the project,\u201d StratOil stated.
\nThe company expressed with great satisfaction its role that enabled the tremendous achievement of MODEC in winning a highly competitive tender and in supplying the FPSO within a time frame, which is adjudged a record in the industry for such a deep water project.
\nStratOil noted with satisfaction that it was beneficial to the Jubilee project and to Ghana that the MODEC bid was a low-priced one that met the highest technical standards in the industry, a situation they said would enable first oil flow from the jubilee field in the 4th quarter of last year.
\nStratOil warned at the time that it reserved the right to take legal steps against those who had misrepresented facts concerning the agreement between themselves and MODEC and the due diligence process of equity and debt financiers of the FPSO.
\nThe full MODEC statement is reproduced below:
\nUpdate on the Jubilee Due Diligence
\nTokyo, January 23, 2011 \u2013 MODEC, Inc. announced today that, further to the request of prospective equity partners in the Jubilee FPSO, MODEC commissioned an independent investigation into its service agreement with its contractor.
\nFollowing a thorough inquiry into this matter, conducted, over the last five months, by a well recognized law firm specializing in such matters, independently retained for this purpose by MODEC Board, this investigation has found no evidence of any violation of the U.S. Foreign Corrupt Practices Act or any other applicable jurisdiction’s anti-bribery laws in relation to its arrangement.
\nMODEC will provide an update as matters develop. In the meantime, if there is any request for information kindly contact Otori Masayoshi
\nat Masayoshi.Otori@modec.com.
\nSource: The Business Analyst\/Ghana<\/p>\n","protected":false},"excerpt":{"rendered":"
A five-month thorough investigation conducted into the award of a $5million service contract towards the construction of the Jubilee Field production vessel, FPSO Kwame Nkrumah, has established that there was neither corruption nor bribery in the award of the contract by Mitsui Ocean Development & Engineering Company Ltd (MODEC). A terse statement issued by MODEC […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-275022","post","type-post","status-publish","format-standard"],"yoast_head":"\n