Investigation Papers Opened for Sapura Energy Berhad
PETALING JAYA:
The Malaysian Anti-Corruption Commission (MACC) has opened two investigation papers following information on bribes and misappropriation involving Sapura Energy Berhad. The investigation is based on an initial probe opened at the end of 2023, which also involves claims made related to the company.
Investigation Focus
"These two investigation papers are focused on money laundering activities and misappropriation related to claims made in 2018 when the company was known as Sapura Kencana Petroleum Berhad," said a MACC source. "In addition to corruption, the investigation will focus on issues related to governance weaknesses and management shortcomings."
MACC Chief’s Confirmation
MACC chief commissioner Azam Baki confirmed the probe and said the investigation papers were opened under the MACC Act 2009 and the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.
Sapura Energy’s Financial Troubles
Sapura Energy’s financial trouble started in the mid-2010s due to falling oil prices, leading to annual losses and mounting debt. In 2023, external auditors Ernst & Young flagged concerns over Sapura Energy’s ability to continue operating. Last month, the company secured creditors approval for a debt restructuring plan, which was cleared by the courts last Thursday.
Government’s Decision to Inject Funds
In a Bursa filing on Tuesday, Sapura Energy said the finance ministry, via its special purpose vehicle Malaysia Development Holding Sdn Bhd, would be subscribing to its redeemable convertible loan stocks worth RM1.1 billion. The government’s decision to inject the funds drew accusations that it had bailed out Sapura Energy, a practice which Pakatan Harapan leaders had condemned during the coalition’s time in the opposition.
Permodalan Nasional Bhd’s Statement
Permodalan Nasional Bhd (PNB), the existing significant shareholder of Sapura Energy, said the funds invested would be exclusively and directly used to repay the oil and gas firm’s local vendors. It said this was crucial to ensure the financial survival of Malaysian service providers within the O&G ecosystem, pointing out that Sapura Energy had more than 2,000 vendors. Many of these vendors were small and medium-sized enterprises and made up about 59,000 workers in the O&G sector.
Conclusion
The investigation into Sapura Energy Berhad is ongoing, and the public will be updated on any developments. In the meantime, the company’s financial troubles and the government’s decision to inject funds have raised questions about governance and the role of the government in bailing out struggling companies.
FAQs
- What are the allegations against Sapura Energy Berhad?
The company is facing allegations of bribes and misappropriation, as well as governance weaknesses and management shortcomings. - What is the government’s role in the situation?
The government has injected funds into Sapura Energy Berhad, which has drawn accusations that it is bailing out the company. - What is the purpose of the investigation?
The investigation is focused on money laundering activities and misappropriation, as well as governance weaknesses and management shortcomings. - What is the impact on the company’s vendors?
The funds injected by the government will be used to repay the company’s local vendors, which is crucial to ensure their financial survival.