US prosecutors have dropped their corruption investigation into Cobalt International Energy five years after the Houston-based oil explorer’s local partner in an Angolan deal was revealed to have been secretly owned by top officials from the African nation.

Cobalt said on Wednesday that it had received a letter from the US Department of Justice stating that it had closed its probe of the company’s Angolan operations under the Foreign Corrupt Practices Act, which makes it a crime to pay or offer anything of value to a foreign official to win business.

Cobalt chief executive Timothy Cutt said in a statement: “We are obviously pleased with this resolution and the closure of this investigation. Cobalt has been and is firmly committed to conducting its operations in compliance with all applicable laws and regulations, including the FCPA.”

The DoJ did not immediately respond to a request for comment. The Securities and Exchange Commission dropped its parallel civil investigation into the allegations in 2015.

The corruption allegations surfaced shortly after the authoritarian government of Angola — Africa’s second-biggest oil producer after Nigeria — granted Cobalt rights to prospect off its Atlantic coast in 2011. The government assigned two little-known local partners to the project, one of which was Nazaki Oil & Gáz.

In 2011 an Angolan anti-corruption activist, Rafael Marques de Morais, claimed that Nazaki was secretly controlled by three of the most powerful men in the land, including Manuel Vicente, who had been head of the state oil company at the time it granted Cobalt its rights and is now vice president.

The following year Mr Vicente and another top official, the security chief General Manuel Hélder Vieira Dias Júnior, known as Kopelipa, confirmed to the Financial Times that they had indeed held previously concealed stakes in Nazaki. They denied wrongdoing, as did Cobalt, which maintained that it had been unaware of the officials’ interests in its partner.

Cobalt, which is listed in New York and also has prospects in the Gulf of Mexico, struck oil under Angola’s seabed. Founding shareholders, including Goldman Sachs and US private equity groups, profited handsomely. Nazaki transferred part of its interest in the project – a stake worth an estimated $1.3bn – to the state oil company Sonangol for an undisclosed fee. In 2014, Nazaki and the other local partner in the venture transferred their remaining interests to Sonangol, ending their connection to Cobalt.

In 2015 Cobalt said that it, too, planned to cash out, by selling its 40 per cent interest in the venture to Sonangol for $1.75bn. But that deal unravelled last year after Isabel dos Santos, the billionaire daughter of Angola’s president, took over at Sonangol.

Low oil prices had cut Sonangol’s revenues but Ms dos Santos would only say in an FT interview in December that the deal had failed to meet “regulatory conditions”. She added that Cobalt was in “very advanced discussions” with other potential buyers.

Copyright The Financial Times Limited 2023. All rights reserved.
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