Kashagan to be ruined by Italian convict and our businessmen in ministerial chairs

By Azamat Maitanov

Paolo Scaroni, Eni CEOPaolo Scaroni, the CEO of Italian transnational oil and gas company Eni, is sentenced to three years of imprisonment.

Reuters reported the sentence was pronounced on March 31 by the court of Rovigno (the city in northeast of Italy). The sources close to Reuters informed that judgment is connected with violation of nature protection norms by Porto-Tolle's power plant in north of Italy during 2002-2005 when Skaroni held a position of general director of Enel Porto Tolle company.  The company is the leader in housing-and-municipal industry of Italy and is controlled by Silvio Berlusconi's group.

La Repubblica newspaper reports that the court accorded prosecution that stated there were connections between excessive emissions from power plant and damage made to health of population and environment.

Refusal to install ecological equipment led to increase in number of respiratory diseases and tumors with children. The damage is estimated at 3,6bn euro.

Scaroni distributed the statement in which he informed that he is shocked with such court decision. “I don’t have any relation to this business and I will appeal against the decision immediately,” - said Scaroni. - The Porto Tolle power plant always conformed to all existing standards, including the period of time that is specified in the resolution”.

To recall, Scaroni who has been closely connected with the former prime minister of Italy Silvio Berlusconi, is leading the state company Eni for the third term that expires in May of this year.

Got into “clean hands”

Nurlan Kapparov, RoK Environmental MinisterIn Italy and on international oil and gas market Paolo Scaroni has a reputation of unscrupulous businessman and lobbyist, capable of pulling out any profitable contract from any pocket.

In 1992 he was trapped by the well-known police operation “Clean hands” directed against mafia influence in government and law enforcement agencies, in particular, against illegal financing of election campaigns and bribery of politicians. In due time he served prison term on charges of bribery of Italian Socialist party politicians for the purpose of obtaining favorable contracts for Enel company.

Except the present scandal in Italy, the charges of bribery to the government of Algeria have been also brought against Paolo Scaroni. Eni and engineering company Saipem received 11bn dollars contract from the government of Algeria. According to investigators, for this purpose the Italian companies through the firm in Hong Kong transferred a bribe in the amount of 197mln euros to a number of Algerian politicians.

In total there are eight people under suspicion, including two top managers of Saipem - the company where Eni owns 43% of shares. In 2009 Saipem received a contract for construction of oil pipeline in the north of Algeria. The project cost estimated at 580mln dollars.

Bribe for Kashagan

Erbolat Dosaev, RoK Minister of Economic Affairs and Budget PlanningAs for Paolo Scaroni's and ENI’s activity in Kazakhstan, it also had an element of corruption scandal. In May of 2012, prosecutor's office in Milan suspected the company of giving a large bribe during the conclusion of contracts for the development of Kashagan field.  According to investigators, at least, 20 million dollars in bribes were paid to a certain Kazakhstan politician on the first development stage of the Kashagan field, during the period till the spring of 2007.

It is clear that Kazakhstan law enforcement agencies showed no interest to the information from Italy and didn't start to investigate who exactly in Astana got this money.

Whether there was a bribe or not - the operatorship of Eni in anyway hallooed to Kazakhstan six years later when Kashagan project is on the verge of failure due to numerous “substandard work”. 

To recall, the pipelines that had “holes” were welded and laid by Saipem (the same “daughter” company of Eni who is involved in corruption scandal in Algeria) and Ersai Caspian Contraktor LLP (the division of Lancaster Group founded by Nurlan Kapparov and Erbolat Dosaev, both are ministers in the present RoK government). Pipes were supplied by various companies, one of which is the Japanese metallurgical giant Sumitomo.

This is what the source close to AkZhaik newspaper said about the current situation with pipelines from the place of the accident:

-  Currently the activities include the removal of two pipelines -  oil and sulphurous gas. The first version of the incident about low-quality welding of joints has not been confirmed. All removed pipes got burst lengthways, as if they were accurately cut by “Bolgarka” cutting machine. Practically all pipes will require replacement and that is  95 km of pipes from Kashagan to Karabatan.  The situation is complicated also due to coastal part of the Caspian Sea where the pipelines run, are very marshy. The equipment bogs into dirt, only the roof is exposed.  Recently two new Hitachi excavators bogged down – we sent them back to the manufacturer.  The activities could be performed in winter time or in the middle of summer, when the weather is very hot.  I am compelled to disappoint oil minister Uzakbai Karabalin who hopes that Bolashak plant will be re-started this year.  Here the work scope is for another year or two …”.