Africa Oil & Gas: Saipem found guilty, Eni acquitted in Algeria graft case

An Italian court found oil services group Saipem and a former chief executive guilty of corruption in a long-running trial over bribes in Algeria but acquitted oil major Eni.

In a court ruling on Wednesday, Milan judges sentenced one-time Saipem chief executive Pietro Tali to four years and nine months in prison and seized 197.9 million euros ($231 million) from the company. Saipem was also fined 400,000 euros.

In the same ruling, the court acquitted Eni, its former chief executive Paolo Scaroni and its current upstream head Antonio Vella.

Under Italian law, companies are responsible for the actions of their managers and can be fined if found guilty.

Saipem said in a statement it reserved the right to appeal the decision once the reasons underpinning it had been made known within 90 days. Tali has previously denied any wrongdoing.

The long-running case revolves around allegations Saipem paid intermediaries about 198 million euros to secure contracts worth 8 billion euros with Algeria’s state-owned Sonatrach.

Prosecutors claimed money was also paid to allow Eni to get a green light from Algeria’s energy ministry to buy Canadian oil and gas company First Calgary Petroleums, which held rights to Algeria’s Menzel gas field.

“Eni welcomes today’s judgment of acquittal on the grounds there was no case to answer,” the Italian major said in a statement.

Scaroni, currently deputy chairman of Rothschild and chairman of Italian soccer club AC Milan, said he was pleased with the decision.

In February prosecutors had asked for a jail sentence of six years and four months for Scaroni and five years and four months for Vella.

Saipem is jointly controlled by Eni and state lender Cassa Depositi e Prestiti. When Scaroni was Eni CEO it was 43 percent owned by the energy major.

Algeria has historically been an important market for Saipem and current CEO Stefano Cao has previously said he is keen to repair relations with the country.

In February Algeria’s state energy firm Sonatrach signed an agreement with Saipem to end legal disputes over four gas projects.

In its ruling on Wednesday the court turned down requests from Sonatrach and the Italian tax collection agency for compensation.

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