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Algeria to blacklist corrupt foreign companies

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AOMAR OUALI | June 20, 2013 03:54 PM EST | AP

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ALGIERS, Algeria — Foreign companies that are convicted of corruption in Algeria will be blacklisted from working in the country, the energy minister said Thursday.

Algeria is rich in oil and gas. Bolstered by the high price of oil in the past 10 years, it has embarked on ambitious infrastructure projects, many of which are now subject to corruption investigations.

"All foreign firms involved in corruption will from now on be placed on a blacklist in Algeria, and will no longer be able to form partnerships in Algeria," Energy Minister Youcef Yousfi told parliament. He also said convicted foreign companies will be asked to pay reparations.

Meanwhile, Yousfi said, strict new internal measures have been imposed on future partnerships with foreign companies.

Algeria is currently investigating Italian company Saipem and the Canadian company SNC-Lavalin. Most such deals have involved the state energy company Sonatrach.

Algeria's investigations were prompted by the January announcement by Milan prosecutors that the oil company ENI and its subsidiary Saipem allegedly had paid (EURO)197 million to secure a (EURO)11 billion deal with Sonatrach.

The latest corruption allegations involve power plants built for Sonelgaz, the national electricity provider.

Yousfi said Monday that the former and current heads of the company were under investigation. The local press has alleged that the U.S. company General Electric and French company Alstom were involved.

There is a widespread public perception in Algeria that corruption goes all the way to the top levels of government and that any investigations are just the results of score-settling between rival elites. Many of the scandals have been linked to Yousfi's predecessor as energy minister, Chakib Khelil, a close associate of President Abdelaziz Bouteflika.