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Dominican Today: Dominican Shell scandal: fuel figures were hidden since 2004

SANTO DOMINGO. – Shell’s representatives in the Dominican Petroleum Refinery’s (Refidomsa) governing board have prevented the Government’s attempts to know the figures on fuel purchase costs and marketing since 2004.

The members that represent Shell in the governing board rejected the first attempt to control Refidomsa’s purchase and fuel sales in a meeting in October, 2004. According to the data collected by the newspaper Listin Diario, that first attempt was raised in a session headed by then president Arístides Fernandez Zucco.

The Dominican State and Shell have an equal stake in Refidomsa and both have 4 members in the governing board, though Shell designates the administrative personnel and controls the commercial operations. The State was trying to designate personnel for “controlling and auditing the financial operations of the company with respect to the hydrocarbon purchases, white fuel purchase, currency purchase and the purchase of consumable items and raw materials.”

At the end of the session Shell’s representatives rejected being supervised on fuel purchases and sales. The Government’s representatives alleged that fuel was often bought at prices of US$5 and US$7 per barrel over the average within the San José Agreement.

They also complained that very frequently the urgency surfaced to buy fuels and Refidomsa was seen in the need to acquire it in the open, “spot” market, which prevented it from having the time to pick a better offer.

In those circumstances the State demanded “a rational explanation for this situation.” “We bought at US$49 in the market of the gulf of Texas and that same day the prices in the Mexican market are to US$36 and in the Venezuelan one at US$39. “Then it’ not understood why we bought where it’s more expensive,” alleged one of the members of the State’s representatives, according to the Listin Diario, quoting a source.

Shell’s representatives said they themselves were in the need to buy in the spot market from the urgency after the crisis in Venezuela that prevented the shipments.

It was also announced then that the general manager at the time would be transferred and replaced by Alfredo Nara.

In the meeting the State’s representatives also complained that the system to control the stock of fuel malfunctioned and for that reason the frequent need for “spot” purchases.

It was learned that in the meeting the State’s representatives in the board warned that the situation of the shortage of supplies is “very important and grave.”

Gasoline retailers’ chief rails Shell.

This Friday morning, the president of the National Association of Gasoline Retailers (Anadegas), Juan Ignacio Espaillat, also accused the international oil firm of fraud in Refidomsa. “With the money from the fraud that Shell committed agaisnt the country in the Refinery both the internal as well as the external debt can be paid.”

29 June 2007

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