Leighton Holdings Ltd, parent company of Leighton Offshore, is under investigation by Australian federal police after the company notified authorities of a possible illegal payment by one of its subsidiaries linked to work expanding Iraq’s crude oil export facilities.
The Australian construction company said it wasn’t yet known if there had been any wrongful or illegal conduct, or whether Leighton would suffer any adverse financial consequences as a result.
According to a statement on its website, Leighton Holdings Limited said it had reported to the Australian Federal Police a possible breach of its Code of Ethics that, if substantiated, may contravene Australian laws.
The possible breach related to payments that may have been made by Leighton’s subsidiary company, Leighton Offshore Pte. Limited, in connection with work to expand offshore loading facilities for Iraq’s crude oil exports.
Leighton Holdings’ Chairman, Mr Stephen Johns, said that Leighton had volunteered the information to the AFP after becoming aware of a possible breach.
“We are cooperating fully with the AFP as they conduct an investigation into these matters,” said Johns.
Leighton Holdings’ Chief Executive Officer, Hamish Tyrwhitt, said that Leighton’s values were integral to Leighton’s approach to business.
“Our Code of Ethics and our values have been, and will continue to be, critical to our culture. Our values are consistently applied across the Leighton Group and deviations from those values are not tolerated,” said Tyrwhitt.
At this stage it is not known whether there has been any wrongful or illegal conduct, or whether there will be any adverse financial consequences for Leighton. The AFP investigation is at an early stage and, accordingly, Leighton is not in a position to make any further comment.
On October 16 2011 Leighton Holdings announced that its subsidiary Leighton Offshore had been awarded a major contract by Iraq’s South Oil Company.
The US$518 million contract forms part of the Crude Oil Export Facility Reconstruction Project (the “Sea Line Project”), which is financed and supported through the Japanese Official Development Assistance (ODA) Loan by Japan International Cooperation Agency (JICA). The Project involves the development of two offshore platforms, a 75 kilometer 48” oil pipeline and a Single Point Mooring system.
The project’s aim was to stabilize and expand Iraq’s crude oil export capacity, a lifeline of the Iraqi economy, by constructing a pipeline connecting crude oil storage facilities to the offshore crude oil export terminal in Fao, Basrah in Southern Iraq.
