Tag Archives: rolls royce

Leak of Venezuela contractor documents raises questions (Updated)

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Tomás Lander

What appears to be a leak of internal documents from Missouri electricity industry contractor ProEnergy Services and Venezuelan contractor Derwick Associates adds to questions about how ProEnergy got deals to sell products made by General Electric, Pratt & Whitney and Rolls Royce to Venezuelan state industries starting in late 2009.

The documents, posted to the website Scribd Nov. 17 by a person using the name “Tomás Lander,” include a proposal dated June 2009 from ProEnergy to Venezuela offering power plants. At the time, Venezuela was suffering periodic blackouts because demand for electricity was growing, a drought was draining hydroelectric reservoirs and the 2008 commodities bust had left the country with limited cash to deal with the crisis.

I haven’t been able to confirm that the documents are genuine. I sent e-mails to Derwick Associates’ press line, ProEnergy CEO Jeff Cannon and ProEnergy chief counsel Scott Dieball, asking them to validate or refute the authenticity of the documents and requesting comment. I haven’t received any response. At a glance, nothing about the documents indicates that they are forgeries. As such, for the rest of this article I will treat them as genuine documents. If ProEnergy, Derwick or anyone else offers any commentary on the documents, I will update this post to reflect their response.

The documents don’t show what happened to that ProEnergy proposal. However, another document shows that two months later, ProEnergy and Derwick agreed to cooperate in seeking work in Venezuela. Their agreement forbids either company from revealing “any and all details regarding transactions between Derwick and ProEnergy, details regarding transactions between a party and third parties, and the payment of fees and commissions.”*

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Will Rolls Royce scandal touch Venezuela?

A few months ago, Rolls Royce said its sales team may have gotten a bit too enthusiastic in sealing deals in Indonesia and China. Reuters reported at the time:

Aerospace and defence group Rolls-Royce (RR.L) may face prosecution after Britain’s Serious Fraud Office (SFO) ordered it to hand over details of possible bribery and corruption in China and elsewhere, the company said on Thursday.

The world’s second-largest maker of aircraft engines said the SFO had asked it to conduct an internal inquiry into dealings involving intermediaries in China, Indonesia and other overseas markets, which it did not name, and report the results.

“It is too early to predict the outcomes, but these could include the prosecution of individuals and of the company. We will cooperate fully,” Chief Executive John Rishton said.

This story doesn’t mention it, but Rolls Royce has also sent equipment to Venezuela, via some unusual intermediaries. Here’s an article in Spanish. It would be interesting to know why exactly Rolls was willing to sell turbines to middle-men rather than selling for possibly twice as much money directly to PDVSA.