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TMCnet: Shell denies wrongdoing at Dominican refinery

(EFE News Service Via Thomson Dialog NewsEdge)

Royal Dutch Shell PLC said Thursday it is not responsible for alleged irregularities in the management of this Caribbean nation’s only fuel refinery, which is jointly owned by the Dominican government and the multinational but administered by Shell.

Dominican government auditors found that the Shell managers running the Refidomsa facility have been shortchanging consumers and the state, Listin Diario newspaper reported Wednesday.

The auditor-general’s office, which reviewed operations at the refinery for the 3 1/2 years ending May 31 of this year, said in a posting on its Web site that Shell managers engaged in at least a dozen questionable transactions during the period.

But Shell said Thursday that all of the decisions questioned by the auditors were made by Refidomsa’s board, which is evenly divided between representatives of the Anglo-Dutch oil giant and the Dominican government.

Hence, Shell said, it is up to Refidomsa to respond to the report from the auditors.

Listin Diario said Wednesday that during the period studied, 18.7 percent of Refidomsa’s purchases were from Shell Western Supply & Trading, a Barbados-based affiliate of the multinational firm.

The auditors also found at least two instances where Shell managers overstated what Refidomsa paid for purchases on the spot market, resulting in higher prices at the pump for consumers and less revenue for the Dominican government.

The audit was undertaken in June after President Leonel Fernandez’s administration accused the Shell executives running Refidomsa of keeping fuel prices “artificially” high.

In a statement released before the audit began, Shell called the allegations unfounded and “defamatory,” saying that the government was trying to scapegoat the company for high fuel prices.

Fernandez said last month that his government will seek to purchase Shell’s 50 percent of Refidomsa if the multinational follows through with plans to shed its assets in the Caribbean country.

Shell, which began operations in the Dominican Republic in 1929, is the country’s main fuel distributor.

December 20, 2007 

Copyright 2007 EFE News Services (U.S.) Inc., Source: The Financial Times Limited and its sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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