The parent company of Leighton Offshore, the company contracted to construct offshore oil loading facilities in south Iraq, has sacked a senior manager after reports of corruption in winning the contract.
In an announcement today to the Australian Stock Exchange, Leighton Holdings said “a senior manager” has been dismissed after an internal review confirmed “instances of failures to meet governance standards in respect of the proper documentation of contractual arrangements” at Leighton Offshore in Iraq.
As previously reported, Leighton Offshore in Iraq is under investigation for corruption, after Leighton Holdings reported it to the Australian Federal Police on concerns over “a possible breach of its Code of Ethics that, if substantiated, may contravene Australian laws” in November 2011.
The Australian Financial Review reported that a senior employee at Leighton Offshore may have bribed Iraqi oil officials to disclose rival bids for either or both of the $518 million Crude Oil Export Facility Reconstruction Project, or $79 million contract for additional mooring capacity, both of which were won by Leighton Offshore in October 2011.
The $518 million deal was financed through a development assistance loan with Japan International Co-operation Agency.
In October 2010 the company won a $733 million contract for the Iraq Crude Oil Export Expansion Project Phase 1, which was completed earlier this year and has led to an uplift in Iraq’s oil exports.
The Project involves the development of two offshore platforms, a 75 kilometer 48” oil pipeline and a Single Point Mooring system in Iraqi waters offshore Fao in Basra province.
Leighton Holdings’ Chief Executive Officer, Hamish Tyrwhitt, said that “Leighton’s values are integral to Leighton’s approach to business. No deviation from those values will be tolerated and appropriate disciplinary action will be taken if necessary”.
No charges have yet been brought, and an Iraqi probe resulted in no action. Leighton Holdings says it is continuing to cooperate with the ongoing AFP investigation.
