Deputy PM drawn into BHP probe

DEPUTY Prime Minister and Trade Minister, Mark Vaile, has been personally linked to the UN oil-for-food scandal, after a document released yesterday by the Cole inquiry named him in attempts to recover an illegal $US8 million BHP Billiton debt from Iraq.
Deputy PM drawn into BHP probe Deputy PM drawn into BHP probe Deputy PM drawn into BHP probe Deputy PM drawn into BHP probe Deputy PM drawn into BHP probe

The document said Vaile met with AWB senior manager Charles Stott in Melbourne in 2000 to discuss the debt.

But Vaile has denied the alleged meeting, saying he had no record of being in Melbourne on that day, as described in an email sent on September 15, 2000 by former BHP executive, Norman Davidson Kelly to Stott.

The email said: “Tigris is an Aussie registered company and enjoys the support of our friends at DFAT, who as I told you, are interested the outcome of the discussions to recover the Obligation.

“It was good to see you, Mark Vaile and Bob Bowker [former DFAT Middle East director] in Melbourne yesterday.”

Vaile yesterday responded that his diary entry said he was in Sydney, not Melbourne, on the day in question.

The alleged meeting with Vaile occurred the day after BHP decided to assign a debt for a US$5 million wheat shipment to Tigris Petroleum – a company Davidson Kelly set up in late 2000 after leaving BHP.

The reference in the email to the "Obligation" was an allusion to the debt, originally $US5 million, which ultimately reached $US8 milion after interest built up. The debt was recovered by inflating the prices of several wheat shipments under the UN's food-for-oil scheme.

Commissioner Terence Cole ridiculed the notion that the wheat shipment coudl failry be described as a donation.

"Are you using the word donation in lieu of the words soft bribe?" Cole asked Stott at the inquiry today.

"Donations don't normally attract interest".

The inquiry has been told BHP’s current head of trading, Phil Aiken, authorised the debt to be allocated to Tigris on September 14, 2000.

While it looks as if Aiken will have to face the inquiry, the former BHP and Tigris executive who played a key role in the two companies' dealings with Saddam Hussein's regime has refused to say whether he would go to Australia if called to give evidence to the Cole inquiry.

Norman Davidson Kelly was at the heart of BHP's involvement in the wheat-for oil rights deal and the debt recovery process, but he is a British citizen and the Cole inquiry cannot force foreign citizens to appear before it.

The Scottish-born oil executive told The Australian yesterday from his home in England that his lawyers were considering how he should respond to the inquiry.