Curacao puts off selecting oil-refinery operator pending probe

FILE PHOTO: A general view shows the Isla refinery in Willemstad on the island of Curacao, April 22, 2018. REUTERS/Andres Martinez Casares

(Reuters) - The government of Curacao has suspended its selection of a new operator for the Caribbean nation’s 335,000-barrel-per-day Isla refinery until a probe into corruption allegations involving the search has concluded, officials said on Friday.

Isla refinery, which has operated under a contract with Venezuelan state-run oil firm PDVSA that lasts through December, began a search for a PDVSA replacement after a dispute last year between the Venezuelan firm and U.S. oil producer ConocoPhillips left the plant idled amid asset seizure attempts.

A memorandum of understanding with PDVSA’s replacement was expected to be signed and disclosed in mid January, a refinery executive said last month.

Negotiations to choose a new operator, however, “are still in status quo pending the finalization of the internal investigation at Refineria di Korsou,” the company said in an email to Reuters, using the formal name for the refinery.

A spokesperson was not available to immediately elaborate on the statement.

In December, Houston-based Motiva Enterprises [MOTIV.UL] was chosen as the “preferred bidder,” after an 8-month review, according to local media. Isla resumed operations earlier this year after an 8-month paralysis.

An investigation into the operator bidding process was opened last November after the refinery’s supervisory board received unspecified allegations about the bidding.

The board put the plant’s managing director and two other employees on temporary leave during the probe, which has delayed the selection.

Reporting by Sailu Urribarri; Writing by Marianna Parraga; Editing by Sandra Maler