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Cobalt says SEC ends second FCPA probe

Cobalt International Energy, Inc. said in a securities filing Tuesday that the SEC has finished its second FCPA investigation into the company’s Angola operations and won’t bring an enforcement action.

Houston-based Cobalt said the SEC opened the second investigation in March 2017.

The company received notice about the SEC declination on January 29, according to the filing first posted by FCPA Tracker.

The second investigation concerned Cobalt’s funding of the Sonangol Research and Technology Center under an agreement with Sonangol EP, Angola’s state-owned oil and gas company.

The DOJ and SEC had conducted an earlier FCPA investigation into Cobalt’s Angola operations. That investigation also ended with declinations.

The earlier investigation started in late 2011. It concerned allegations that Angola officials held an interest in Nazaki Oil and Gas SA. Nazaki was Cobalt’s partner until 2014 in two offshore blocks in Angolan waters.

The SEC issued a declination to Cobalt for that investigation in January 2015. And the DOJ issued a declination in February 2017.

The SEC started the second investigation two months later.

Cobalt was delisted from the New York Stock Exchange on January 16 this year. It had filed for Chapter 11 bankruptcy a month earlier. The company now trades on the OTC Pink marketplace under the symbol CIEI.

Cobalt sold its interest in the Angola blocks to Sonangol in December for $500 million. The original agreed price was $1.75 billion. But Sonangol backed out of the original deal in August 2016.

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Cobalt International Energy, Inc.’s full FCPA disclosure from its January 30, 2018 Form 8-K said,

On January 29, 2018, the United States Securities and Exchange Commission (the “ SEC ”) concluded its FCPA investigation relating to the Angolan operations of Cobalt International Energy, Inc. (“ Cobalt ”) and advised that the SEC staff does not intend to recommend any enforcement action by the SEC against Cobalt. This formally concludes the SEC investigation, which was opened in March 2017.


Richard L. Cassin is the publisher and editor of the FCPA Blog.

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