Saturday, January 21, 2012

Why would anyone walk away from $80 million?

Early summer last year a huge scandal emerged: the Ukrainian state company 'ChornomorNaftogaz' purchased a deep sea drilling rig for $ 400 million after what supposedly was a competitive tender process. In the event, only two intermediary companies - the New Zealand Falcona Systems Ltd, and the Cardiff UK-based Highway Investment Processing LLP submitted tenders.

According to their published accounts the source suppliers of the rig, the Norwegian SDRL-Seadrill, received almost $250 million for the rig, so the winners of the tendering process, Highway Investment Processing LLP, took a mind-numbing $ 150 million 'cut' on the deal.

[Highway Investment Processing LLP offices, incidentally lie between 'Tony's Italian and North Indian Cuisine Cafe', 'Chillies Take-Away', and 'Tattoo-U' tattoo parlour, in Cardiff, Wales.]

More here and here

'ChornomorNaftogaz' paid 80% up-front. The rig is currently in a Turkish port having its legs welded on, and the balance is to be paid after installation on site.

However, 'Ukrainska Pravda's investigation of records of the official British comanies' registrar, "Companies House" reveal that 'Highway Investment Processing LLP' is being dissolved, and "will be struck off the register....Upon dissolution, all property and rights vested in, or held in trust for hte LLP..will belong to the crown [i.e. the British Sovereign and State]".

Big questions: Why is a nameplate company which will be 20% of $400 million, i.e. $80 million richer in several months, being wound up? An why should 'ChornomorNaftogaz' pay the balance to a company that will cease to exist in less than 3 months?

Yuriy Boyko was asked about this business on Friday's 'Velyka Polityka z Yevheniem Kyselyovym' by AFP journalist Anya Tsukanova. He rather shiftily responded that transportation of the rig to site cost $15 million... for the other bits and bobs just ask Halliburton [Oilfield Services] who are responsible for its commissioning. And that's it. A Ukrainian proverb came to LEvko's mind: A thief's hat is always on fire....

The creepy Kyselyov, instead of following up the question, sensing Boyko's discomfort, muttered something about Halliburton being a huge US company once led by former secretary of defense Dick Cheney...and moved on.

Everyone knows the whole thing stinks to high heaven....sooner or later chickens will come home to roost..

p.s. If Halliburton are to be paid by 'Highway Investment Processing' for the commissioning work on the rig, they'll surely be getting worried about receiving payment, no? They will have conducted due diligence, so will be aware of the dirty little secrets...

p.p.s. 'Znak Oklyku' documentary on this topic here

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