Petrobras cancels Ensco drillship contract over alleged corruption

UK-based rig contractor Ensco says scandal-plagued Brazilian oil giant Petrobras has cancelled a contract for a drillship, according to Reuters.

Ensco said Petrobras cited suspected corruption as rendering the contract void.

Petrobras, the state oil company, is the focus of a major corruption probe involving bribes for inflated contracts and kickbacks to company executives and politicians.

As it tries to rectify huge losses related to the corruption, the drop in the oil price and overreach on its own part, Petrobras has been slashing budgets and investments, while simultaneously ditching assets and cancelling contracts.

In this case Petrobras claims that the drillship in question, a DS-5, was originally chartered from Pride International, a company taken over by Ensco in 2011. Petrobras says that a third-party marketing consultant of Pride received irregular payments from the drillship’s builder to provide services in connection with the DS-5 drilling services contract.

The allegations have not been proven although Brazilian investigators say they are building a case.

Ensco, which has four other assets operating for Petrobras, says it intends to enforce its contractual rights.

Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.
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