* In two transactions in 1996 and 1998, the holding company controlled by Obiang received a combined stake, now worth as much as $29 million, in two joint ventures that Marathon inherited when it bought CMS Energy's Equatorial Guinea holdings in 2002. According to the Senate report, Obiang obtained his stakes through GEOCAM, a state-controlled energy firm that is a partner in the joint ventures and in which his holding company owns a 25% share.
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Oil Firms' Rich Concessions to Tainted African Ruler Probed
THE WORLD
For The Record
Los Angeles Times Wednesday December 22, 2004 Home Edition Main News Part A Page 2 National Desk 2 inches; 85 words Type of Material: Correction
Equatorial Guinea -- An article in Saturday's Section A included Noble Energy Inc. in a list of companies under investigation by the Securities and Exchange Commission for their operations in Equatorial Guinea. Noble has a minority stake in an energy project in Equatorial Guinea but has not been contacted in regard to the investigation, a company spokesman said. The project operator, Marathon Oil Corp., said in a public filing that it was contacted by the SEC and that it was "cooperating fully" with the inquiry.
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GEOCAM put no money down for its initial shares. Obiang's holding company has netted more than $1 million in dividend payments from the two ventures over the last two years, according to the Senate report.
Alexandra Wrage of TRACE, a nonprofit association that advises corporations on compliance with the Foreign Corrupt Practices Act, said no previous probe had examined the activities of so many oil companies.
Wrage said companies must ensure that deals they strike overseas are not merely vehicles for funneling cash to a government official. "If it's a primary decision maker and they are not contributing money or technical expertise, that's a bright red flag," she said.
A Washington lawyer, who spoke on condition of anonymity, said that if a company is concerned that a transaction would violate the FCPA, it can ask the Justice Department for an advisory opinion. "It's a cumbersome process ... but in close cases I recommend that clients do it," he said.
Dealings between Obiang and Exxon Mobil, Marathon and Amerada Hess are the object of intensive scrutiny. Exxon Mobil declined to say whether it had sought an advisory opinion in regard to Equatorial Guinea. The other two companies said they had not.
Asked about its dealings in Equatorial Guinea, Exxon Mobil cited a prepared statement by Executive Vice President Swiger to the Senate, which said that many businesses in that country "have some family relations with a government official" but that the company's commerce there had been conducted "in strict compliance with U.S. and local laws."
In a statement to The Times, Amerada Hess said that Triton Energy Ltd., which it bought in 2002, was responsible for most of the activities examined by investigators. "We do not believe that the company ... has engaged in any activities that violate the FCPA," it said.
Marathon said it did not know for sure that Obiang had a stake in its projects until this summer. Regarding its land deals, Marathon said it had paid fair market prices and had no choice but to deal with Obiang because he owned the land it needed.
