OHL México on the defensive over audio recordings

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Friday, November 27, 2015

Audio recordings uploaded to YouTube appear to suggest that OHL México president José de Andrés de Oteyza sought direct help from the heads of Mexican state companies Pemex and CFE to win a US$476mn contract to build the combined cycle power plant Empalme 1, according to local media reports.

The tapes are the latest in a series of leaks from alleged telephone conversations between OHL México executives and high ranking government officials over business deals.

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Proceso newspaper cites a March 31 recording in which Oteyza is supposedly heard telling Jesús Campos, technical director at OHL México, about meetings with Pemex CEO Emilio Lozoya and CFE chief executive Enrique Ochoa in the days leading up to the awarding of the contract for Empalme I.

"To a large extent I arranged this on Thursday night with Lozoya, and on Friday I spoke directly to Ochoa, directly, because Emilio [Lozoya] fixed it for me," De Oteyza purportedly said.

Empalme I was awarded on March 31 to a consortium comprising Senermex, Sener, IEPI México and OHL Industrial at a cost of US$476mn.

OHL Mexico has made no comment on the matter.

Pemex, meanwhile, issued a press release stating that "Petróleos Mexicanos categorically distances itself from supposed family members of executives of this company who, using their names, have tried to deceive various people in order to obtain personal benefits." It added that it "denounces these illegal activities, which are not related to the transparency that characterizes the operations and activities of the company."

For its part, the CFE said in a release: "It is absolutely false that the general director of CFE, Enrique Ochoa Reza, met on Friday, March 27, 2015 with Mr. José Andrés de Oteyza. On that date, Dr. Ochoa Reza was in La Paz, Baja California Sur."

"It is also totally false that the tender for the Empalme I combined cycle power plant project was fixed," the state-owned electricity utility added.

During the recordings the person alleged to be De Oteyza is heard admitting that the Spanish firm Iberdrola had a high probability of winning the contract because it had submitted a good proposal.

The new recordings were published almost at the same time as OHL México submitted its response to banking and securities regulator CNBV regarding allegations made during the administrative proceedings filed against the firm last month for allegedly manipulating traffic data.

In May this year, OHL Mexico was notified that the state of Mexico and the federal government would audit all of its contracts. The state government in May decided to freeze any future increase in tolls for the Viaducto Bicentenario overpass, a public works initiative awarded to OHL Mexico that is embroiled in an alleged corruption scandal that was also made public through audio recordings.

The federal judicial council is currently carrying investigating the company.