Brazil judge releases 11 pending Petrobras trial

STAN LEHMAN, Associated Press

A federal judge has released 11 of the 24 people arrested in the corruption scandal engulfing Brazil's state-owned oil company Petrobras.

SAO PAULO (AP) — A federal judge has released 11 of the 24 people arrested in the corruption scandal engulfing Brazil's state-owned oil company Petrobras pending the trial in the case.

Federal court press officer Christianne Machiavelli said Judge Sergio Moro on Tuesday evening ordered the release of those people he doesn't think will jeopardize the investigation.

The 11 include construction company executives who allegedly bribed Petrobras officials to win bids from the oil producer.

They were ordered to turn in their passports and told they cannot leave the country or change their address without the court's authorization.

The other 13 people arrested last week were not allowed to leave prison because they were deemed capable of jeopardizing the investigation, Machiavelli said without providing details.

Authorities have alleged that top Petrobras operated a kickback scheme on contracts involving several billion dollars, with the money eventually being fed back to the governing Workers Party and other top parties for political campaigns.

Petrobras is Brazil's biggest company and is in charge of tapping big offshore oil fields and creating wealth that leaders hope will propel the country to developed world status.

Many of the allegations center on what police have heard from Alberto Youssef, a convicted black-market money dealer who said that he laundered hundreds of millions in the scheme and that the governing party benefited from it.

Youssef, who is talking to police in exchange for a lighter sentence, claims recently re-elected President Dilma Rousseff and former President Luiz Inacio Lula da Silva knew about the kickbacks. He has offered no proof, and both leaders deny the allegation.

In a separate case involving the oil company, a Senate commission is investigating Petrobras' purchase of the Pasadena Refining System in 2006.

Petrobras paid Belgium's Astra Oil $360 million that year for a 50 percent stake in the refinery. A year later, Astra exercised an option requiring Petrobras to buy the remaining 50 percent. Petrobras refused, but lost an arbitration case in the U.S. in 2012 and had to pay $820.5 million for the remaining 50 percent, including interest and legal fees.

In the end, Petrobras paid $1.18 billion for a refinery that cost Astra $42.5 million in 2005.

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