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Deloitte resigns as auditor of controversial Addax Petroleum

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Deloitte LLP has resigned as auditor of Addax Petroleum, a Swiss unit of China Petroleum and Chemical Corp (Sinopec), after failing to obtain “satisfactory explanations” from the Chinese-owned oil producer regarding more than $100m in payments to advisers in Nigeria and the U.S., amongst others, the audit firm said in a letter.

The payments in question relate to a 2015 audit and include more than $20 million recorded as fees to “legal advisers” in Nigeria and the U.S. paid from bank accounts in Nigeria and the Isle of Man.

“It has not been clearly established what services were delivered for the amounts paid,” Deloitte said.

In addition to the unexplained fees to legal advisers in Nigeria and the U.S., Deloitte said transfers to an engineering company in excess of $80 million relating to construction projects in Nigeria also raised questions.

“The magnitude of these payments appears to be in excess of the demonstrable value of work performed and their purpose and timing raise issues which have not been resolved,” Deloitte said.

The accountants say they formally alerted the management of Addax in August 2016. However, Addax insists that it was not informed until November.

This is not the first time that the Addax’s activities in Nigeria are under the spotlight. In 2000, two former employees were sentenced in Switzerland for money laundering. In 2006, the company was involved in a scandal involving the award of a drilling contract.

https://www.letemps.ch/economie/2017/02/21/groupe-genevois-addax-mis-accusation-auditeurs