PetroSaudi executives ‘hid 1MDB loss from Najib’

KUALA LUMPUR: A controversial email involving a conversation between PetroSaudi International executives Tarek Obaid and Patrick Mahony has surfaced, where the duo were discussing 1Malaysia Development Bhd (1MDB)-related matters.

In the email, which was sighted and published by news portal The Edge, Mahony and Obaid agreed not to tell former prime minister Datuk Seri Najib Razak about a US$500 million (RM2.02 billion) loss that 1MDB would have to take on.

Mahony, when writing to Obaid, also revealed that elusive financier Low Taek Jho had agreed for 1MDB to “take a US$500 million loss on the PetroSaudi investment and that for UBG (Utama Banking Group Bhd), he would get us US$300 million to US$400 million back”.

On top of that, Mahony and Obaid also planned to tell Najib how important it was for 1MDB to quickly invest another US$500 million with them.

The email also exposed them, saying that if 1MDB did not want to invest any more money, then the money could come from Petronas or the Employees Provident Fund (EPF).

Mahony wrote to Obaid: “I think saying delays have cost us helps us because we can then blame them for the losses later.”

He said they should tell Najib privately to appoint another reliable person for them to work with instead of Low, showing that their relationship was already in trouble just a year after 1MDB had poured US$1 billion into a joint venture.

Mahony wrote that Najib should be told that while “we really appreciate the relationship, it is difficult to talk about more things when we know the one guy (Low) we need to speak to is too busy with other things or out partying”.

1MDB had remitted US$1 billion on Sept 29, 2009, of which US$700 million was illegally diverted to Low’s company, Good Star Ltd.

The joint venture was on shaky grounds and Low and his partners were seeking another US$500 million from 1MDB.

In August 2010, the plan was for the three men to meet Najib to discuss about the joint venture.

1MDB later invested another US$800 million with PetroSaudi, taking the total investment to US$1.8 billion, which now forms part of the worthless “units” cited in its accounts.