Petrobras contracts freeze would 'harm' Brazil

Wednesday, November 19, 2014

A senior Brazilian court official warned that forcing engineering firms involved in the Petrobras corruption probe to down tools would harm the country.

Those under investigation, according to local press, are Odebrecht, Queiroz Galvão, Camargo Corrêa, OAS, Andrade Gutierrez, Galvão Engenharia, Engevix, Mendes Júnior, Constra, UTC Engenharia and IESA.

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The companies are carrying out large infrastructure projects both in Brazil and abroad.

"Stopping works as a whole would be a great loss to the nation," federal audit court TCU president Augusto Nardes was reported as saying by local paper Diário do Nordeste.

Instead, contracts should be renegotiated, he added.

Federal oil major Petrobras and external firms are at the center of the probe - dubbed Operation Car Wash - launched to investigate an alleged US$4.5bn money laundering ring.

The engineering firms are responsible for works in the transportation infrastructure, oil and energy sectors, among others.

A full assessment and analysis is needed to determine whether companies should be declared inapt and whether they should be prohibited from signing new government contracts, Nardes said.

"It seems that companies are demonstrating goodwill as they are helping, arranging ways to return resources," Nardes was quoted as saying.