Pakistan

Transparency issues: Spectre of kickbacks haunts $20b LNG deal

Petroleum ministry’s insistence on Carlyle consortium deepens concerns.

Rauf Klasra December 26, 2010

ISLAMABAD: Authorities in Islamabad are highly concerned over news reports of kickbacks and bribes in the $6 billion liquefied natural gas (LNG) scandal in Nigeria and a lawsuit against former US vice-president Dick Cheney, because some quarters are interested in awarding a $20 billion LNG contract to the same consortium led by the Carlyle group owned by Cheney, reliable sources told The Express Tribune.

The consortium also includes a company owned by a cousin of French President Nicolas Sarkozy.

Highly-placed sources said that authorities concerned are seriously considering the likelihood of bribes and kickbacks in the multi-billion-dollar contract, which the petroleum ministry is insistent on awarding to a French company which did not even take part in the bidding process.

Interestingly, kickbacks amounting to $180 million were said to have been paid in the Nigerian deal.

However, the law ministry is strictly opposing assigning this contract to the said company with a bad reputation.

Former US presidents – elder and younger Bush – are also partners in the consortium.

The Economic Coordination Committee of the cabinet will take a final decision on the deal next week. A decision is being awaited since April this year. The law ministry wants this contract to be awarded in a transparent manner. On the other hand, authorities in the ministry of petroleum have been dispatching the same summary for the past nine months.

Earlier, the summary could not be approved after the intervention of the Supreme Court when the then finance minister Shaukat Tareen wrote a letter to the apex court, complaining that the petroleum ministry had tried to deceive him on this matter.

The start of the litigation process against Dick Cheney’s company in Nigeria is supporting the idea that since it bribes the authorities all over the world, it is impossible for authorities in Pakistan to have foregone lucrative offers of substantial kickbacks.

A government functionary wondered if $180 million were paid in kickbacks in the $6 billion contract, how much would have been offered in lieu of the $20 billion contract.

The Carlyle group also seems to be interested in securing the deal with the active support of some elements in the petroleum ministry.

Published in The Express Tribune, December 26^th, 2010.

COMMENTS (2)

hassan | 13 years ago | Reply very nice govt is very good at makin such deals... but i wud say hats off to Rauf Klasra n other invetigative journalists who r exposing their black deals.

Sher Ali | 13 years ago | Reply 20 billion dollars? Who makes these ridiculous decisions? LNG is a very expensive business and only those countries which can not have gas pipelines due to their geography buy LNG. Pakistan should not even think about doing this deal. It is loss maker deal. Pakistan has only one option to build the pipeline with Iran and getting the gas from Iran a nation which in its entire history has never paid even a single cent in kick-backs and bribes. Iranian gas price is the quarter of the price of LNG and almost half of what is being promised by TAPI pipeline. Besides TAPI pipeline is highly unsecured since it is going through Afghanistan which is a lawless country since its inception. Pakistan can not afford to have a week of gas and then go without gas for three weeks every month because the pipeline is blown up by some disgruntled war lord in Afghanistan. Iran can be trusted with supplying the gas the same way Turks are getting their gas from Iran. It is amazing to see that Turkey a country with an economy 6 times larger than Pakistan is buying its gas from Iran and not using ultra-expensive LNG while poor Pakistan is opting for the most expensive form of natural gas (LNG). I am sure large sums of bribes and kick backs are involved in this deal and that is why this irrational decision. Pakistan should take up the Iranian offer and import its gas and electricity from Iran which is going to be cheap compared to international prices as well as secured. Iran has already built the pipeline upto Pakistani border and all that is left for Pakistan to build the rest of pipeline from Iranian border and connect it with national gas grid. Same is with electricity.

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