Petrofac to plead guilty on UK bribery charges related to Saudi, UAE, Iraq oil projects

Petrofac will plead guilty in a UK court to seven counts of failing to prevent bribery on projects it was awarded in Saudi Arabia, the UAE and Iraq between 2012 and 2015, the oilfield services company said Sept. 24, hoping to put behind events that have led it to being suspended from doing business with Abu Dhabi National Oil Co.

The UK Serious Fraud Office said that Petrofac had entered into a plea agreement related to the charges, and that penalties will be determined at a Sept. 27 hearing. Petrofac said in a statement that all employees involved in the bribery schemes have left the company.

"This was a deeply regrettable period of Petrofac's history," CEO Sami Iskander said. "We are committed to ensuring it will never happen again. We have fundamentally overhauled our compliance regime, as well as the people, and the culture that supports it."

ADNOC in March barred Petrofac from bidding on its projects "until further notice" following the January guilty pleas to bribery charges by its former head of sales. The suspension remains in place.

It was alleged that $30 million in bribes were paid to steer ADNOC projects to Petrofac, including an EPC contract in 2013 to develop the offshore Upper Zakum oil field, a variation to that contract awarded in 2014 and a front-end engineering design contract in 2014 on the Bab Integrated Facilities Project, according to the UK SFO. The contracts were worth a total of $3.3 billion, the SFO said.

The suspension was a massive blow to Petrofac, which had called the UAE a "core market" that represented 31% of its 2020-21 bidding pipeline. Pandemic-related financial struggles in the global oil industry had already caused many of Petrofac's 2020 projects to be delayed or canceled.

The executive, David Lufkin, also plead guilty in 2019 to using corrupt influence to gain $3.5 billion worth of projects in Saudi Arabia and $730 million in contracts in Iraq.