Petroleos Mexicanos (Pemex) has made progress in talks with global energy trader Vitol about resuming trading ties that broke down last year during a bribery scandal, and the companies must iron out some issues such as compensation for damages Mexico’s state oil company suffered, two sources at Pemex said.
The sources at Pemex (PEMX.UL) did not offer details on how the damages from the scandal would be calculated or give an estimate. Vitol and Pemex declined to comment.
In March 2021, Pemex said it had suspended its commercial relationship with Vitol after the oil trader admitted to paying bribes to retain business in Mexico.
At the time, Pemex also said Vitol had offered compensation for damages but insisted the trader reveal the names of the Mexican officials that allegedly received the bribes and the specific contacts involved.
In May Pemex said in a statement that Vitol had previously offered $22 million in compensation, which also included “work” on the Pajaritos ethanol terminal, without giving further details. Pemex said the offer was not good enough as it did not include the identities of those responsible for the corruption.
Later that month, Vitol did reveal the names and since then conversations have been progressing towards resuming trade between the two firms, the two Pemex sources said.
President Andres Manuel Lopez Obrador has said the officials that received the bribes were part of the previous government.
Both sources said no concrete decisions have been made regarding resumption of business and that lawyers at Pemex are still analyzing some topics.
The sources did not provide a timeline on how long the conversations might still last. The progress in talks has not been previously reported.
“We’re resuming conversations but we still haven’t agreed on anything (regarding the purchase of product). There are several issues still in the legal department,” the source said, adding that one of them is compensation for damages.
Another senior source at Pemex confirmed that talks were happening but that nothing had been closed neither on new contracts or older ones.
“It will now depend on whether the payment for damages are adequate,” the source said, without specifying how much it should be.
Vitol’s subsidiary in the United States agreed in late 2020 to pay $164 million as part of a deferred prosecution agreement following a U.S. investigation into corruption in Brazil, Ecuador and Mexico. Vitol had admitted to paying more than $2 million in bribes between the three countries.
Pemex had told Vitol it had canceled contracts for the supply of butane gas, naphtha and propane gas.