PEMEX Resumes Business With Vitol Amidst Corruption Scandal
Home > Oil & Gas > News Article

PEMEX Resumes Business With Vitol Amidst Corruption Scandal

Photo by:   pixabay
Share it!
Karin Dilge By Karin Dilge | Journalist and Industry Analyst - Thu, 09/21/2023 - 03:35

PEMEX has recently taken the significant step of resuming its business dealings with Vitol, a Swiss-based energy and commodities trader. This development comes almost three years after the NOC imposed a ban on transactions with Vitol in the wake of a widely publicized corruption scandal.

Vitol executives confessed to US authorities in December 2020 that they had engaged in briberies with PEMEX, as well as officials in Brazil and Ecuador, to gain confidential information for securing contract bids. The case initially opened in New York but was later dismissed by a judge who deemed the state unsuitable for jurisdiction. This led to a parallel investigation in Mexico, prompted by President Andrés Manuel López Obrador's complaint.

Months later, PEMEX's CEO, Octavio Romero, announced that Vitol had offered US$17 million as compensation for the corruption accusations, along with terminating the contracts involved "at no cost." Discrepancies arose between López Obrador's claim of US$30 million as compensation. 

Recent events indicate that PEMEX has reversed its stance on trading with Vitol. Anonymous sources have reported that two vessels carrying Vitol cargoes have arrived at Mexican ports. Further confirmation of this development comes from a senior trading source who has corroborated that Vitol has indeed resumed business dealings with Mexico. This marks a significant change in the relationship between the two entities.

Neither the details of these renewed transactions nor the fact that Mexico has resumed trading with Vitol have been reported by either party. Vitol has chosen not to comment on the matter, while both the NOC and the Mexican government have refrained from responding to requests for comment, leaving many questions unanswered.

The Liberia-flagged vessel Arvin, which partially departed from Houston on Sept. 7, arrived at the Mexican port of Pajaritos two days later. It completed its cargo discharge by Sept. 15. The Denmark-flagged vessel Torm Thames, on the other hand, concluded its discharge at the Mexican port of Tuxpan on Sept. 13 and then moved to Tampico, where it is currently moored. These vessels carried various types of gasoline, including regular and premium, along with an additive called methyl tert-butyl ether (MTBE), used to enhance the quality of unleaded gasoline.

Despite these developments, the terms of the settlement between Mexico and Vitol remain undisclosed. Initially, both López Obrador and Romero had publicly stated that any resumption of dealings with Vitol would require adequate compensation and full disclosure of those involved in the previous corruption scandal. PEMEX later revealed the names of two former officials linked to the scandal and mentioned Vitol's compensation offer, though the specifics of how this was resolved remain opaque.

After the corruption scandal surfaced, reports indicated that Mexico was seeking to renegotiate several of its contracts with Vitol, which collectively amounted to hundreds of millions of dollars. Romero had indicated that unfavorable contract terms would be discarded and negotiations appeared to reach an impasse as Vitol refused to accept the proposed changes.

Javier Aguilar, a former executive of Vitol, entered the first trial phase in the US, facing allegations of bribery involving a PEMEX subsidiary. Aguilar was formally charged with five counts as of Aug. 3, 2023. The charges relate to his alleged involvement in bribing Mexican officials to secure commercial advantages linked to contracts of the PEMEX Procurement International (PPI) subsidiary, headquartered in Houston. The Texan native also faces accusations of money laundering associated with this bribery scheme.

Photo by:   pixabay

You May Like

Most popular