Parker Drilling to book $15m graft charge

Bouncing back: Parker Drilling boss says recovery already underway as losses loom

Houston-based Parker Drilling has said it will record a $15.85 million charge to cover a proposed settlement of its part in a corruption case that has ensnared several explorers.

Allegations first emerged in 2007 that Swiss-based logistics firm Panalpina had engaged agents who bribed foreign officials to speed drilling rigs and other equipment through customs.

In 2010, Panalpina and five of its clients – Shell, Transocean, Tidewater, GlobalSantaFe and Pride – made settlements totalling $236 million over the scandal.

Parker Drilling first disclosed five years ago that its operations in Nigeria and Kazakhstan were potentially caught up in the investigation.

The driller now says it has reached agreement in principle with the US Department of Justice and the Securities and Exchange Commission regarding a settlement, which is subject to final agreement and court approval.

Chief executive Gary Rich said that the explorer had and would continue to “maintain a vigorous foreign corrupt practices act compliance programme”.

Meanwhile the company also disclosed on Friday that it expects to post a net loss when it reports its results for the final quarter of 2012, in addition to the corruption charge.

Parker Drilling cited slower demand for barge drilling rigs and increased competition in the rental tools market onshore the US and in the Gulf of Mexico for the loss.

Rich admitted the impact of a sluggish market was being felt in the short term but added "each of our operations has responded to market conditions in ways that are already beginning to have a favorable impact”. 


Become an Upstream member!

Membership includes a subscription to our weekly newspaper providing in-depth news from the energy industry, plus full-access to this site and its archives. Still not convinced? Try our free trial.

Already a member?