Tullow Oil deals signed by disgraced Peru ex-president under fire
LIMA, (Reuters) - Pedro Pablo Kuczynski’s critics call it his last act.
Hours before the former Wall Street banker resigned Peru’s presidency in scandal last month, Kuczynski signed five oil contracts granting Londonbased Tullow Oil exploration and drilling rights off Peru’s northern coast.
Lawmakers have vowed to investigate and try to repeal the contracts. They say there should have been a public auction, an environmental study and consultations with fishermen, biologists and coastal residents about sites that lie in an important fisheries area rich in biodiversity.
Critics are unconvinced by Peru’s oil promoting agency, Perupetro, which said the contracts followed months of negotiations and should be celebrated for the $200 million investment they will bring to a country where bidding rounds are often canceled due to lack of interest.
“It’s not normal for a president, just before resigning, to sign five decrees giving away our resources,” said Congresswoman Karla Schaefer with the conservative party Popular Force. “Given Mr. Kuczynski’s background, it raises a lot of questions.”
Kuczynski’s less than two years in office featured clashes with Popular Force lawmakers who depicted him as an unscrupulous lobbyist. He resigned after being implicated in an alleged vote-buying scheme to prevent possible impeachment over payments his consulting firm received from Odebrecht, a company at the center of a massive graft scandal.
Kuczynski denies wrongdoing and has promised to cooperate with public prosecutors investigating him. Kuczynski’s lawyer did not respond to requests for comment about Tullow Oil.
The company has been cautiously reviving its search for new oil and gas resources after emerging from one of the longest downturns in the sector’s history with a $3.5 billion debt pile.
For foreign investors in one of Latin America’s most stable economies, the latest controversy brought reminders of a how a more than yearlong graft scandal involving Odebrecht has heightened scrutiny of government contracts and fueled political feuds in Peru.
Tullow said it started direct negotiations with Perupetro as allowed by Peruvian law in November. “Both the terms and conditions of our contracts and the process for approving them are similar to those signed with other oil companies in 2017,” it said in a statement.