MOSCOW (MRC) -- Braskem SA, Latin America's largest petrochemical company will start talks with US authorities over accusations of corruption linked to a massive graft investigation in Brazil, reported Reuters.
In its quarterly results statement, the company said talks with the US Justice Department and the Securities and Exchange Commission (SEC) will clarify additional allegations of illegalities raised in the investigation of third parties.
Braskem's two main stakeholders, state-run oil company Petroleo Brasileiro SA and Odebrecht, are engulfed in a giant bribery scheme that has led to the arrest of Odebrecht's CEO and other top engineering executives.
Braskem has been the target of a shareholder lawsuit filed in mid-2015 in the US over the alleged release of false statements to shareholders.
"At this moment the company has no way of measuring the impact that an eventual confirmation of those allegations could have," Braskem Chief Executive Officer Fernando Musa told reporters in a briefing.
Musa said Thursday he expects demand in Brazil this year to drop between 5.5% and 6%, less than its previous forecast for a fall of 7%.
The giant "Operation Carwash" investigation has unveiled a multi-billion dollar corruption scheme that involved executives of the country's top construction companies and senior politicians.
We remind that, as MRC informed previously, in late March 2016, Braskem Idesa, the 75-25 joint venture between Braskem and Grupo Idesa, started injecting ethane at their Etileno XXI cracker project at Coatzacoalcos, Mexico. By the end of March, the company had the cracker running at 60% capacity with the first polyethylene (PE) line up and running. Once the complex is fully operational, high and lowdensity polyethylene (plastic) production will amount to more than 1 million metric tons annually and allow Mexico to substitute 70 percent of its imports of those materials. The complex will have the capacity to process 66,000 barrels per day of ethane, a feedstock for ethylene production that the complex will purchase from Mexican stateowned oil company Petroleos Mexicanos, or Pemex, and which previously had gone to waste.
Braskem is Brazilian main producer of polyethylene and polypropylene. In addition with ongoing plants located in both petrochemical complexes, in April 2008 Braskem opened a 300,000 metric ton polypropylene plant in the city of Paulinia (Sao Paulo).