Court Hears: Oil Company Exec Proposed $50 Million Bribe To Uganda President

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[Global: Africa]

A U.K. court heard Thursday that a top Tullow Oil company executive suggested payment of a $50 million bribe to "meet the short term needs and demands" of Uganda's ruler of 27 years Gen. Yoweri K. Museveni, court records show.

The "needs" and "demands" were in connection to Museveni's 2011 presidential election which supporters of top challenger Dr. Kizza Besigye say he ultimately stole.

Gen. Museveni is a close U.S. ally and critics say Washington ignores human rights abuses and corruption by his government's officials.

The revelation of the proposed bribe to the Uganda president, referred to euphemistically as an "undocumented payment" emerged Thursday in a U.K. proceeding where Tullow is seeking to recover $313 million from rival Heritage Oil, which also operates in Uganda.

It's not yet known how and under what circumstances the Ugandan leader made the "demands" and specifically what he called for, if at all.

Foreign oil companies including Tullow have long been-dogged by accusations of alleged bribery to the tune of tens of millions of dollars to top Uganda officials, including to prime minister Amama Mbabazi, foreign minister Sam Kutesa, and then energy minister Hilary Onek, who now holds the internal affairs portfolio.

Earlier, Uganda government officials and Tullow denied allegations made in October, 2011 by a Uganda member of parliament Gerald Karuhanga who presented documents  he claimed detailed the payment of tens of millions of dollars.

In U.S. embassy cables leaked by Wikileaks in 2010 then U.S. ambassador to Uganda Jerry Lanier had also voiced concern that corruption in the emerging Uganda oil industry could place U.S. firms such as ExxonMobil in a competitive disadvantage.

Ambassador Lanier said a Tullow executive, Tim O'Hanlon, Vice President for African Business, told him that Italy's ENI had paid bribes to two Ugandan officials, Onek and Mbabazi, to secure licensing rights sought by Tullow and owned by Heritage.

The cable, dated December 17, 2009, in part read, that O'Hanlon "requested U.S. assistance in ensuring the open and transparent sale of oil assets." The cable added: "If TULLOW's allegations are true -- and we believe they are-- then this is a critical moment for Uganda's nascent oil sector. The Heritage-ENI sale will likely derail any potential partnership between TULLOW and Exxon Mobil and have profound consequences for transparency and openness in the future management of the industry."

ENI and Heritage denied the allegations.

Ambassador Lanier recommended that the U.S. consider revoking the visa of officials such as Ugandan prime minister Mbabazi's. The prime minister has since then traveled to the U.S.

A second cable leaked by Wikileaks, in September 2011, said Andy Demetriou, a Tullow employee in charge of external relations, told U.S. embassy officials President Museveni had received a payment by Italy's ENI, to secure Tullow rival and sometimes partner Heritage's exploration rights.

Tullow later denied the allegations in the cable and Museveni denied, in not-very-specific terms, receiving any payments from a "white" person for his "personal use" in a news conference.

According to testimony in the U.K. trial: "Angus McCoss, exploration director at Tullow Oil, suggested to fellow executives in a group email in August 2010 the company should pay for an oil license to 'meet the short term needs and demands' of President Museveni, referred to as M7."

Information on the U.K. court's website also reads: "Senior directors at Tullow Oil allegedly discussed making an 'undocumented' $50m (£33.4m) payment to the Ugandan government before considering funding parts of the re-election campaign of President Yoweri Museveni."

It's unclear what, if any, additional information of the bribery allegations will emerge.

When Karuhanga produced the documents allegedly detailing the bribery, Tullow and the Uganda officials denied the accusations. Tullow called the documents "crude forgeries" in a written response.

Karuhanga claimed Tullow's bribes to the Ugandan officials, through banks in London and Malta, amounted to $100 million.

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