MercoPress. South Atlantic News Agency

Argentina and Repsol in another clash: this time over board members payments

CEO Brufau: the lawsuit is aimed at diverting attention from YPF difficulties

Argentina's nationalized energy company YPF will sue the head of Repsol SA over accusations that YPF's board members were overpaid when the Spanish oil major held a majority stake in the company, the government said.

At a lengthy shareholders meeting, YPF decided to sue Repsol Chairman Antonio Brufau for allegedly overpaying members of YPF board of directors between 2003 and 2011, a statement posted on Argentina's presidential website showed.

YPF said in a statement late on Friday that it could also take legal action against the board members themselves.

Repsol threatened to file its own lawsuit in response and it defended the salary payments, saying they fully complied with Argentine laws and regulations.

YPF estimated that 38 million dollars was paid to board members without shareholders' approval, saying its lawsuit “will hold Brufau personally responsible for the harm caused to the nationalized company,” the government statement said.

Argentina seized 51% of YPF from Repsol one year ago, accusing the Spanish company of falling short on investment. Repsol has sued Argentina for compensation of about 10 billion dollars but nothing has been resolved so far.

Brufau said the lawsuit was aimed at diverting attention from YPF difficulties in boosting oil and gas production.

“You will have seen in the press that they have filed a lawsuit or a civil complaint against the chairman and those who have been involved in this situation,” Brufau said at Repsol's annual shareholders meeting in Madrid.

“The historic position of Repsol and YPF has always been that the YPF general shareholders assembly must approve the allowances and fees of the board of directors but not the salaries of the executives that form part of the board,” Brufau said.

”This is backed by legislation, by lawyers' reports and by auditors.