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Shell directors face up to 5 years in jail if guilty of price-fixing

Screen Shot 2013-05-17 at 01.06.41By John Donovan

Assessment of current situation in the price-rigging investigation partly based on an articled published today by The Lawyer today under the headline “All eyes on energy“:

  • Royal Dutch Shell is being advised by Clifford Chance in relation to the allegations of price-fixing.
  • Competition lawyers say that the investigation could be “bigger than Libor”.
  • If the allegations prove to be true, there is the prospect of unlimited fines and jail terms of up to 5 years for  directors.
  • There is an incentive of reduced sanctions dependent on the degree of co-operation i.e. turning informer.
  • Shell has confirmed that it is co-operating with the investigation.
  • Shell lawyers will have to decide whether to defend or continue to co-operate.

Shell and BP in secret meetings about oil

Screen Shot 2013-05-19 at 08.31.34Top petrol chiefs held talks once a year: The whistleblower claimed the office was swept for bugs before the talks, lasting nearly two hours. He added: “The security around their meetings was incredible. There was lock-down. The whole floor was a no-go area for anyone else. “It was just the two of them — the bosses of two huge rival companies — no PAs, no deputies. “It’s common knowledge they were talking about oil prices.”

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Meetings … oil bosses Jeroen van der Veer, left, and John Browne

Shell and BP bosses met secretly to fix oil prices?

The Sun newspaper alleges Shell boss Jeroen van der Veer secretly met Lord Browne of BP once a year to discuss oil prices. Perfectly matched pair to engage in some jiggery-pokery.

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By John Donovan

The Sun newspaper alleges Shell boss Jeroen van der Veer secretly met Lord Browne of BP once a year to discuss oil prices.

Under the website headline “Shell and BP in secret meetings about oil”, the Sun is publishing an article on Sunday alleging that Jeroen van der Veer, Peter Vosers predecessor as Chief Executive of Royal Dutch Shell Plc, secretly met his BP counter-part, Lord Browne, once a year to discuss oil prices.

(Headline in Sun Newspaper article: “I NEED WORD IN YOUR SHELL-LIKE ABOUT OIL”)

Lord Browne subsequently resigned after becoming involved in a scandal.

Jeroen van der Veer was a participant in the cover-up of the Shell reserves fraud and the Brent Bravo scandal.

Perfectly matched pair to engage in some jiggery-pokery.

We can safely assume that the talks also covered the possibility of a Shell BP merger.

RELATED: Price fixing is in the Shell DNA

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Free access to over 33,000 articles, comment, historical information and news archive relating to corporate tax dodgers Royal Dutch Shell, the worlds largest company.  A 2012 TV documentary feature about our co-founder John Donovan, has aired in many countries (link to related presseurop article). This non commercial website is endorsed by Shell. Recommended articles: Why Shell will not sue us; Simon Henry and the reserves time bomb; Reputational damage to Peter Voser; How Chris Finlayson bungled the Mother of all ProjectsSins of The Reverend Sir Philip Watts SITE STATS: 3,957,525 hits and 2,241,669 page views in April 2013.

Groningen Exxon/Shell gas fields – the Dutch earthquake zone

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By Anna Holligan BBC News, The Netherlands

As earthquakes become more intense and more frequent in the north of the Netherlands, there is mounting pressure on the government to reduce the amount of gas being extracted there.

It is a curse for thousands of inhabitants having to cope with the effects of living amid the Groningen gas fields – the largest in Europe.

There exists a consensus among all parties – including the gas companies – that the process of extracting the gas is causing earthquakes, but the country is thriving on the proceeds.

In 2012 the Dutch government made about 14bn euros (£12bn; $18bn) from the Groningen gas fields. Without these revenues, the Netherlands’ deficit would be similar to that of crisis-struck Cyprus (6.3%).

“It comes rumbling towards you, louder and louder and louder,” says Daniella Blanken, who runs the Groningen Ground Movement.

“Everything starts to shake. It ends with a bang, like a massive weight dropped on the house. Boof! And that is frightening, really really frightening.”

She is driving us through a newly built neighbourhood. It is Dutch-style suburbia: a canal running down the left side of the street. But Middelstum is one of the worst-hit areas.

What percentage of these homes here has been affected? “At least 60% but the old ones are worse,” she says.

Cracked steps

Approximately 60,000 homes lie within the earthquake zone. The gas companies are dealing with about 6,000 damage claims.

Earlier, at Ms Blanken’s cosy kitchen table, she struggled, voice cracking with emotion to explain their desperation: “We want them to put our safety on top of everything, but they don’t, they really don’t.

“The government is meant to protect its citizens,” she says, then pauses before adding: “We don’t feel protected.”

We pull up outside a flower-festooned farmhouse. Number 13. Home to Klaas Koster and Jannette Schoorl.

A measuring device reveals a jagged split about 7cm (2.7in) wide running through a concrete step and up the side of the house, as though lightning has struck and left an ugly, indelible mark.

BBC map

“The experts told us this part of the house is saying ‘goodbye’,” says Mr Koster.

His tone is jovial, a deliberate effort to cope with a problem residents are powerless to prevent. The floor of the utility room is clearly subsiding. It is an extraordinary concern in a region that lies almost entirely below sea level. This is not a land that can afford to sink any further.

Nor can it afford to give up its gas habit. At the Dutch parliament in The Hague, 200km (124 miles) away, Economics Minister Henk Kamp explains why: “Almost all the people heat their houses with Groningen gas and they cook their meals with Groningen gas.

“It’s also important because of the budget of our government.”

The Dutch government owns large stakes in the gas fields. While there is sympathy, few are prepared to sacrifice the relative economic prosperity generated by the Groningen gas.

As one car park attendant puts it, “If the Groningers don’t like it, they should just move elsewhere.”

There is another reason the economics ministry has rejected some scientific recommendations to cut the scale of explorations immediately: contracts.

“We have long-term contracts with other countries,” Mr Kamp admits. “And that’s also an important point for us.”

The government was unable to give an exact value. The economics minister told us they were trying to establish if financial penalties would be incurred by reducing the supply to foreign buyers.

‘Nothing excluded’

Groningen gas was discovered in the 1960s. Since then, the Dutch government has reaped an estimated 250bn euros from the sale of this natural resource.

Last August there was a magnitude 3.4 tremor. Higher than any expert had previously predicted, it further sapped the residents’ confidence and forced the ministers to commission an inquiry.

“Until now we always knew that earthquakes could occur, now we don’t know what the new maximum could be,” says Chiel Seinen, who represents the NAM oil company collective incorporating Royal Dutch Shell Plc and Exxon Mobil Corp.

“There is a compensation scheme in place. A million-euro fund? No, there is no limit. People can count on it that we at NAM will compensate them for any damage caused by the earthquakes.”

Does Chiel Seinen believe that lives could be in danger? He raises his eyebrows: “You can never exclude anything. If people are in the wrong place at the wrong time…”

And that is the fear of those whose ancestors lived on the land long before the gas firms started shaking it.

The Groningen Ground Movement is currently considering taking its case to the European Court of Human Rights, on the grounds their basic right to live without fear is being violated.

Back on the farm, Mr Koster pours steaming glasses of sweet herbal tea and retrieves a thick pile of newspaper cuttings from a corner – contrasting the scale of the coverage with the level of government response.

He and Ms Schoorl are two of the many people still waiting for compensation. They are tired of fighting to convince the experts, funded by NAM, that the latest cracks were caused by the extractions.

And Ms Schoorl is having trouble sleeping: “We sleep underneath a beam. At night I think, what if there was another earthquake and that beam was to come down on top of us? I hope I will live to tell about it.”

SOURCE

You can’t be sure of seeing Shell’s AGM

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If you couldn’t travel to the Hague to protest, you could always attend the live link-up in London. But now you can’t even do that

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Rupert Neate: The Observer, Sunday 19 May 2013

Angry about the oil giants allegedly fixing the price of petrol for more than a decade? You’ll have a chance to harangue Shell – its offices were raided by European Union officials investigating the claims last week – at its annual general meeting on Tuesday. But only if you get on a plane to the Hague.

Royal Dutch Shell, the British part of which was founded by Lord Bearsted in 1897, has been regularly holding its meeting in the Dutch city most famous for trying war criminals.

For the dedicated investor it could make for a nice little outing. The meeting is at the Circus theatre, a stone’s throw from the beach, and that evening the venue is putting on Sister Act – The Musical.

Until this year, less dedicated British shareholders have been able to gather (and protest) at a simultaneous meeting in London to follow a live satellite link-up.

Not this year. Shell says the live link “did not satisfy shareholders”. A spokesman explains: “We concluded that having the satellite didn’t meet shareholders’ best needs.” He said it would be much easier for all involved if they stayed at home and watched the Dutch event live-streamed online.

Protesting from home would also save Shell having to endure images of thousands of petrol-tank-banging motorists, but he didn’t mention that.

SOURCE

EU oil price probe underlines flawed system

FINANCIAL TIMES

By Ajay Makan and Javier Blas in London: May 17, 2013 5:48 pm

In simultaneous raids this week on the offices of the oil majors BP, Royal Dutch Shell and Statoil of Norway, and Platts, a leading price reporting agency that helps set energy benchmark prices, the European Commission has fired the starting gun on one of the biggest cross-country investigations into benchmark pricing since banks were caught red-handed…

(THIS IS THE BEST ARTICLE WE HAVE READ EXPLAINING ABOUT THE INVESTIGATION AND HOW ENERGY BENCHMARK PRICES ARE SET)

FULL FT ARTICLE

Secret papers ‘show how Shell targeted Nigeria oil protests’

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Documents seen by The IoS support claims energy giant enlisted help of country’s military government

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By Andy Rowell Sunday 14 June 2009

Serious questions over Shell Oil’s alleged involvement in human rights abuses in Nigeria emerged last night after confidential internal documents and court statements revealed how the energy giant enlisted the help of the country’s brutal former military government to deal with protesters.

The documents, seen by the IoS, support allegations that Shell helped to provide Nigerian police and military with logistical support, and aided security sweeps of the oil-rich Niger Delta. Earlier this month Shell agreed to pay $15.5m (£9.6m) in a “humanitarian settlement” on the eve of a highly embarrassing US lawsuit.

One of the allegations was that Shell was complicit in the regime’s execution of civilians. The Anglo-Dutch firm denies any wrongdoing and said it settled to help “reconciliation”. But the documents contain detailed allegations of the extent to which Shell is said to have co-opted the Nigerian military to protect its interests.

The legal settlement came 14 years after the Abacha government hanged nine protesters, including Ken Saro-Wiwa, the environmentalist and writer, after a charade of a trial in 1995. Saro-Wiwa led a successful campaign against Shell in his Niger Delta homeland, even forcing the company to quit Ogoniland in 1993. The campaign focused on environmental devastation and demanded a greater share of oil revenues for his community. As the campaign grew, the Ogoni suffered a brutal backlash that left an estimated 2,000 dead and 30,000 homeless. The documents claim there was systematic collusion with the military and Mobile Police Force (MPF), known as the “Kill and Go”. Shell has always denied this but is believed to have settled in court as a result of the embarrassing contents.

In one document written in May 1993, the oil company wrote to the local governor asking for the “usual assistance” as the Ogoni expanded their campaign. There was a stand-off between the Ogoni and the US contractor Willbros, which was laying a pipeline. Nigerian military were called in, resulting in at least one death.

Days later, Shell met the director general of the state security services to “reiterate our request for support from the army and police”. In a confidential note Shell suggested: “We will have to encourage follow-through into real action preferably on an industry rather than just Shell basis”. The Nigerian regime responded by sending in the Internal Security Task Force, a military unit led by Colonel Paul Okuntimo, a brutal soldier, widely condemned by human rights groups, whose men allegedly raped pregnant women and girls and who tortured at will. Okuntimo boasted of knowing more than 200 ways to kill a person.

In October 1993, Okuntimo was sent into Ogoni with Shell personnel to inspect equipment. The stand-off that followed left at least one Ogoni protester dead. A hand-written Shell note talked of “entertaining 26 armed forces personnel for lunch” and preparing “normal special duty allowances” for the soldiers. Shell is also accused of involvement with the MPF, which worked with Okuntimo. One witness, Eebu Jackson Nwiyon, claimed they were paid and fed by Shell. Nwiyon also recalls being told by Okuntimo to “leave nobody untouched”. When asked what was meant by this, Nwiyon replied: “He meant shoot, kill.”

One former Shell employee, Kloppenburg Ruud, head of group security in the mid-1990s told lawyers that the deployment of Nigerian security forces at two Shell jetties in the delta was at the company’s request.

Since the settlement, Malcolm Brinded, Shell’s executive director, said: “We wanted to prove our innocence and we were ready to go to court. We knew the charges against us were not true.” He added: “I am aware that the settlement may – to some – suggest Shell is guilty and trying to escape justice,” but said this was not the case.

Shell ‘lobbied’ Guardian to soften its Nigeria stance

Confidential internal documents reveal how the oil giant lobbied The Guardian newspaper to reduce its support for Saro-Wiwa.

In an assessment of the political and security situation, a Shell executive noted: ” The Guardian newspaper ran a much more balanced article on the Ogoni issue, with their position moving from apparent support for Saro-Wiwa to the middle ground. There is a slight possibility that this may have been influenced by the meeting we had with The Guardian‘s editor the week before.”

Peter Preston, The Guardian‘s editor from 1975 to 1995, said yesterday that he could not remember a meeting with Shell. “I have absolutely no memory of one. And Nigerian politics was never one of my interests.”

Matthew Bell

SOURCE

Selection of Shell related article links19 May 2013

Selection of Shell related article links kindly provided by a regular contributor

If ‘everyone knew’ the oil market was open to rigging, why did no one The Guardian-It is worth spelling out that manipulation of the oil market, which could  Statoil, BP and Shell are not just petrol providers – they are major gas 

European probe into oil price-fixing widens to Finland: Marketplace.org-May 17, 2013: Earlier this week, EU officials raided the offices of three of Europe’s biggest oil companies — BP, Shell and Statoil — and the oil price reporting company Platts, 

Coast Guard hearing to probe Shell oil rig mishap in Alaska: Alaska Dispatch-Royal Dutch Shell, as well as its contractors Noble Drilling and Edison Chouest, will answer questions from the U.S. Coast Guard at a hearing …

GREENPEACE VS. SHELL OIL: Tahoe Daily Tribune-May 16, 2013: Greenpeace, which is actually a group of environmental activist organizations, adopted a “stop Shell” campaign designed to prevent Shell Oil …

You can’t be sure of seeing Shell’s AGM: The Guardian-18 May 2013: Angry about the oil giants allegedly fixing the price of petrol for more than a decade? You’ll have a chance to harangue Shell – its offices were …

Shell to deploy exploration vessels: TheChronicleHerald.ca-Exploration vessels operated by Shell Canada Ltd. are in Halifax as the  Calgary-based Shell, a subsidiary of the Dutch oil and gas company, …

Trouble on the Colorado River: The Coloradoan-by Bobby Magill-Oil shale is made of solid kerogen, a precursor to crude oil. Energy companies, including Shell, ExxonMobil and others, have been granted …

Al-Qaeda plunders Syria’s oilfields:Irish Independent-A man works at a makeshift oil refinery site in al-Mansoura village in Raqqa’s  quality, and certainly the health and safety standards, demanded by Shell or ExxonMobil,  Near the road sit oil tankers carrying the raw product.

Climate policies must break free from Big Oil: New Europe-Ardent defenders of the polar ice caps like Shell and Statoil will spend  On second thoughts, maybe it is apt for the oil industry and its chums …

Justice for Carousel: Los Angeles Times-“Royalene Fernandez is just one of hundreds of residents of Carousel who were poisoned by Shell Oil Company,” says Tom Girardi of …

Consumer champion: Stop taking us for fuels: The Sun-This time it’s allegations of price-fixing by major oil companies.  This latest probe into the practices of Shell and BP, among others, puts the …

Oil price volatility will be contained: gulfnews.com-Offices of major oil companies such as BP, Shell and Statoil, as well as the price reporting publication Platts, were raided to collect evidence …

Serious Question ? Petrol Price Fixing: Pistonheads.com-Right we have all heard the BP - Shell Price fixing news this week, but what  of course) as a customer we had to pay increased petrol and heating oil prices.

Venezuela to allow oil joint ventures with CNOOC and Chevron: National Post-May 17, 2013: PDVSA is also working on arrangements with oil service providers  Shell’s press department didn’t respond to phone messages and e-mails.

Can Big Oil handle the Arctic?: National Post-May 17, 2013: CALGARY • With the public increasingly worried about oil spills, some aboriginal  (NCOC), Royal Dutch Shell PLC, Statoil ASA, and Total S.A. …

EU oil price probe underlines flawed system: Financial Times-May 17, 2013: In simultaneous raids this week on the offices of the oil majors BP, Royal Dutch Shell and Statoil of Norway, and Platts, a leading price reporting …

Oil price-fixing scandal heats up in Europe – USA Today: USA TODAY-May 16, 2013: They include Britain’s BP, Royal Dutch Shell, which is listed in London  The three oil companies are all major producers in the international …

Elections That Matter: Who Runs the Board Rooms: U.S. Politics Today- On May 14, EU investigators swooped into oil company offices in  of oil. The companies in the cross-hairs are BP, Shell and Norway’s Statoil.

Shell: oil market regulation will cost consumers

 

Royal Dutch Shell lobbied against proposed European rules designed to clamp down on commodity market abuse, arguing they would raise costs for consumers and increase market volatility.

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Shell argued strongly against elements of EC reforms to “strengthen the fight against market abuse across commodity and related derivative markets”.

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SOURCE

RELATED

Libor in a barrel

Oil markets fall under the suspicion of price-fixing on a global scale

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Senator calls for U.S. to join oil price probe

Platts in Lockdown as Investigators Continue Oil Probe

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Screen Shot 2013-05-17 at 01.06.41Published: Friday, 17 May 2013 | 3:54 AM ET

European anti-trust investigators searched the offices of price agency Platts and at least one major oil company for a third day on Thursday, hunting for evidence of possible price manipulation on oil markets, witnesses said.

Authorities raided the London bureau of Platts in Canary Wharf and the offices of Statoil, Royal Dutch Shell and BP on Tuesday in the biggest trading probe since the Libor scandal.

(Read More: EU Raids Offices of Big Oil Firms Amid Pricing Probe)

At issue is whether there was collusion to distort prices of crude, refined oil products and ethanol traded during the Platts market-on-close (MOC) system – a daily half-hour “window” in which it sets prices.

With attention focused on the role of Platts in setting oil price benchmarks, the publisher – a unit of McGraw-Hill – is in lockdown during the European Commission’s inspection, say sources familiar with the company.

A team of inspectors is gathering evidence from laptops, the witnesses said.

“We are all in the dark about it. The investigators will likely be here all week,” said one member of Platts staff. “We have all been told explicitly not to speak to anyone about it.”

Platts continues to operate business as normal, traders said.

As investigators raided the office, reporters were told by Platts management to cooperate. Editorial director Dan Tanz stood up to say it was the “price of being relevant”.

A spokeswoman for Platts did not immediately respond to a request for comment.

Britain’s Serious Fraud Office said it had not yet decided whether to “accept this matter as a criminal investigation”.

“Subject to discussions with other agencies, it is likely that the SFO could be the appropriate authority to investigate allegations of price fixing,” the SFO said in a statement.

The European Commission also is examining whether companies were prevented from taking part in the price assessment process.

A Hungarian ethanol producer on Wednesday was the first company to identify itself as having complained to the European Commission about a Platts procedure that vets companies before they are permitted to participate in its price setting mechanism.

Pannonia Ethanol said it approached Platts last spring to gain access to contribute to the market-on-close window.

It said Platts refused to give the company access, citing “editorial discretion”.

Platts said its established procedure was to vet new participants and had followed the process with Pannonia Ethanol.

Commission inspectors are also continuing their search at the offices of Norwegian Statoil.

“As far as I know, the inspectors are still at our office,” said Statoil spokesman Jannik Lindbaek. “When they came they said that they would spend some days.”

BP and Shell said they were still cooperating with the European authorities.

London is home to some of the biggest trading desks in the oil business. Following the Libor scandal, in which banks have admitted trying to manipulate interest rates, Britain approved legislation making a criminal offence of false or misleading statements in relation to the setting of financial benchmarks.

Britain would be unable to use that law to act against any oil companies found guilty of price manipulation because the law does not include energy benchmarks and punishment would not be doled out retrospectively, the prime minister’s office said on Thursday.

That leaves the European Commission, which can impose large fines, as the most likely source of any sanctions.

Thomson Reuters, parent of Reuters news, competes with Platts in providing news and information to the oil market.

SOURCE

Shell to Start Iraq Oil Output Amid Plans for Saudi Investments

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By Maher Chmaytelli and Nayla Razzouk: May 16, 2013

Royal Dutch Shell Plc (RDSA) will start producing crude at Iraq’s Majnoon oil field as early as next month and plans to increase energy investments in Saudi Arabia, its regional vice president said.

Output from Majnoon, one of Iraq’s largest oil fields, will start “around mid-year” and increase to 175,000 barrels a day by the end of 2013, Mounir Bouaziz said in an e-mailed response to questions. In Saudi Arabia, Shell is holding talks with officials on a project to develop natural gas from the kingdom’s Kidan field in the Rub al-Khali, or Empty Quarter, he said.

“Our discussions with our joint venture partner cannot contractually be disclosed, but I can reiterate that Shell is committed to the kingdom and we are keen to grow our investments both upstream and downstream,” he said.

Saudi Arabia is the world’s biggest oil exporter. Iraq, which holds the world’s fifth-largest crude reserves, overtook Iran last year to become the top producer, after Saudi Arabia, in the Organization of Petroleum Exporting Countries.

Shell has faced “teething problems” at Majnoon, mainly due to the unexpected quantities of unexploded munitions at the field, customs-related delays of imported equipment and slow processing of entry visas, Bouaziz said. “However, what is encouraging is that we do see real improvements in these administrative processes.”

Field’s Operator

Shell is lead operator of Majnoon, with a 45 percent share, while Malaysia’s Petroliam Nasional Bhd, known as Petronas, has a 30 percent stake and Iraq’s government holds the remainder. The field straddling the southern provinces of Basra and Maysan contains estimated reserves of 12 billion barrels of crude and 9.5 trillion cubic feet of gas.

Shell is in “exploratory discussions” with the Iraqi government about the target for oil output at Majnoon, Bouaziz said. Iraq agreed in January with Lukoil OAO (LKOH) to cut targeted production at the West Qurna-2 field, where Lukoil is the operator. The government is also in talks with Exxon Mobil Corp. (XOM) and Eni SpA (ENI) to reduce targeted output at West Qurna-1 and Zubair, respectively.

Whether the discussions result in a reduced plateau, “it is important that the government keeps up with its efforts to provide an enabling environment for the oil and gas investments,” he said.

Associated Gas

Shell and its partner Mitsubishi Corp. (8058) started operations on May 1 at a $17 billion joint venture for salvaging gas from fields in southern Iraq. The venture, Basrah Gas Co., is now capturing 400 million cubic feet a day of so-called associated gas, which occurs together with crude, Bouaziz said. Iraq estimates that it’s losing millions of dollars by flaring off some 700 million cubic feet of gas because it lacks facilities to store and sell the fuel.

Basrah Gas will start within 18 months exporting liquefied petroleum gas, which is used for cooking and heating homes, he said. Iraq currently imports 500 metric tons to 1,000 tons of LPG a day, while it flares 4,000 tons daily, Bouaziz said.

The venture may eventually produce liquified natural gas.

“Considering the amount of gas that will be produced in Iraq, it is very likely that the Basrah Gas Co. LNG project will be needed,” he said. A final decision would be up to state-owned South Gas Co., the venture’s majority shareholder, Bouaziz said.

To contact the reporters on this story: Maher Chmaytelli in Dubai at mchmaytelli@bloomberg.net; Nayla Razzouk in Dubai at nrazzouk2@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

SOURCE

TABLOID COVERAGE OF ALLEGED OIL PRICE FIXING

EXAMPLES OF UK TABLOID COVERAGE OF ALLEGED PRICE FIXING AT THE PUMP

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pdf file of above pages

The Serious Fraud Office ‘urgently reviewing’ oil price inquiry

UK fraud authorities are “urgently reviewing” whether to launch an investigation into companies that may have rigged the oil market and driven up petrol costs for millions of drivers.

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By Rowena Mason and Christopher Hope: 7:06PM BST 16 May 2013

The Serious Fraud Office said it is considering an inquiry, after European Commission officials raided the London offices of BP and Shell. The companies, along with a Norwegian oil giant, Statoil, are suspected of having “colluded in reporting distorted prices to manipulate the published prices for a number of oil and biofuel products”.

It comes the day after David Cameron said he wanted to see prosecutions with the “full force of the law” if the allegations are proven.

Ministers are under pressure for British authorities to launch their own investigation as there are fears that motorists could have been duped into paying thousands of pounds too much for petrol over the past decade.

MPs have demanded to know why the European Commission has launched an inquiry, while the UK’s own Office of Fair Trading pronounced the petrol market to be “working well” earlier this year. The OFT also said it found no “credible” evidence of any oil price manipulation.

Robert Halfon, an MP and petrol price campaigner, today asked the SFO to consider whether it had scope to mount a British inquiry in parallel to the European one.

“The Prime Minister has said through his spokesman and the Energy and Climate Change Secretary has confirmed in Parliament that the Government expects the firms involved to comply with the investigation and if found guilty, they should face the full force of the law,” he wrote to the SFO head David Green.

“Action by the European Commission may be helpful, but it is no subsitute for domestic action by Britain’s authorities. Does the Serious Fraud Office have scope to investigate allegations of market abuse and price-fixing by oil companies?”

Tonight, an SFO spokesman confirmed its officials are considering whether they should get involved.

“Subject to discussions with other agencies as to the potential offences involved, it is likely that the SFO could be the appropriate authority to investigate allegations of price-fixing,” a spokesman said.

“We are urgently reviewing the matter and would expect to announce any decision to accept the case for criminal investigation if and when such a decision is made.”

Oil executives could be investigated under the same powers the SFO used to probe bankers over the pricing of Libor – a key interest rate used as a benchmark to calculate mortgage payments. The authorities have arrested at least three people in connection with that scandal.

The Prime Minister has also said he will urgently look at “extending criminal offences” to make it easier to bring prosecutions against anyone who has manipulated the energy market.

His comments raised the prospect that any companies who are found to have manipulated household gas or electricity prices could also face criminal prosecution.

However, his spokesman today admitted that any change in the law would be forward-looking, and would not be able to hold account any executives caught up in historic fixing of the oil price.

The Prime Minister’s spokesman said: “Following the Libor scandal, the Government legislated to create a new criminal offence and a manipulation of all types of benchmarks.

“This law was done in such a way that other benchmarks could be included, and that would be a change in secondary legislation. Other offences including energy market manipulation could be added in if necessary.”

Any companies proved to have fixed the oil price could also face heavy financial penalties. Mr Cameron’s spokesman said the European Commission “can impose a fine of 10 per cent of the overall turnover of the company”.

The European Commission has emphasised that its investigations are in a “preliminary” stage and no anti-competitive practice has been proven.

BP, Shell and Statoil have said they are co-operating with the authorities but cannot comment further while the European Commission inquiry is active.

SOURCE

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