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A Utah businessman is denying allegations in a lawsuit that he and his Sandy-based company helped Mexican drug cartels resell more than $300 million worth of stolen natural gas liquids.
James Jensen of Sandy said the lawsuit filed by Pemex Exploración y Producción, the Mexican government-owned company that has exclusive control of the nation's petroleum deposits, was without merit.
The lawsuit, filed May 29 in Houston, alleges that Jensen, owner of Big Star Gathering LTD, was among U.S. business owners who knowingly purchased the gas condensate that had been stolen by Mexico's powerful drug cartels from state-owned facilities. It alleges that Jensen even traveled to Mexico to arrange purchases from the cartels.
"We vehemently deny all of these things," Jensen said Wednesday. "Big Star has never bought oil from any entity in Mexico. Really the whole lawsuit we think is just totally unfounded with just lies and rumors."
Jensen said the only time he has been in Mexico in the past 10 years or so was when a cruise ship he was on docked at Mexican ports.
Big Star never knowingly bought petroleum products with origins in Mexico, he said. "We buy from American companies. That's our understanding, that it is generated domestically. … But it's hard to run a business if you think every time you buy you have to hire a detective to go out and try to find out where it comes from."
Jensen and the companies were among several named in the lawsuit for alleged involvement in the theft of the condensate, which is a mixture of hydrocarbon liquids produced with natural gas. Because condensate is free of most contaminants, it is used to make high-value oil products, according to the suit.
Pemex alleges that the cartels stole the condensate from the Burgos Fields that lies in states along the U.S. border. Businessmen from Texas and Utah conspired to sell the stolen liquids to users in the United States, it claims.
American companies transferred the products from Mexican tanker trucks into tankers and storage terminals in the U.S. They bribed Mexican officials and forged documents to facilitate border crossings and resale to U.S. refiners, Pemex alleges.
Big Star purchased condensate from entities such as Y Oil and Gas that was owned by a businessman named Arnoldo Maldonado, the suit says. Maldonado has pleaded guilty in federal court in Texas to felony conspiracy to receive and sell stolen Mexican condensate, according to federal court records.
Jensen said he couldn't say whether Big Star bought from Maldonado but that his company purchased supplies from many companies over the years.
The lawsuit alleges that "Big Star knew that the condensate it purchased and resold was stolen. In the alternative, Big Star either consciously disregarded the fact that the condensate was stolen or should have known that the condensate was stolen."
Pemex wants the companies and individuals involved to repay Pemex for the full $300 million in lost natural gas condensate.
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Bloomberg News contributed to this story.