This investigation is based on leaked documents obtained by the International Consortium of Investigative Journalists (ICIJ) and shared with Arab Reporters for Investigative Journalism (ARIJ) and a large number of publishers around the world under the banner of a project known as the "Pandora Papers". The project is the biggest cross-border journalistic collaboration project in history and include millions of documents from lawyers' offices about tax havens. They reveal assets, secret transactions and the hidden fortunes of the rich, including more than 130 billionaires, more than 30 world leaders, a number of fugitives and convicts, as well as sports stars, judges, tax officials and counterintelligence agencies.
One person of special interest in the Arab world is controversial oil tycoon Mohammad Magdy Hussein Rasikh. Magdy Rasikh is the former chairman of the board of directors of Egypt's National Gas Company, and the son-in-law of former President Hosni Mubarak (1928-2020). On 16 June this year, the Supreme Prosecution Department for Public Funds in Egypt referred Rasikh and other fugitive businessmen for criminal trial before the Cairo Criminal Court in case number 5298 of 2021 of the Heliopolis Criminal Court and case number 96 of 2021 of the Supreme Prosecution Department for Public Funds.
Rasikh's daughter Heidi married Ala'a Mubarak, the late president's eldest son in 1996. Two years later, the fugitive businessman directed his investments towards natural gas and, on 26 May, 1998, he established the National Gas Company as per decision number 961 of 1998 by the General Authority for Investment and Free Zones (GAFI).
On 19 May, 2010, months before the end of the Mubarak regime, the National Gas Company had a decision issued by the Paris Court of Appeals to withhold the funds of the Egyptian General Petroleum Corporation abroad, claiming that a ruling was issued in its favour by the Cairo Regional Centre for International Commercial Arbitration. The Egyptian General Petroleum Corporation was to be fined approximately 254 million Egyptian pounds, the difference in price and dues to the gas company. This came about because of the rise in the prices of the basic requirements needed to implement the project to deliver natural gas to residential, commercial and industrial areas in Al-Sharqiya Governorate between 1999 and 2008.
In a ruling on 3 April, 2014, the International Centre for Settlement of Investment Disputes (ICSID) rejected the lawsuit brought by the National Gas Company against the Egyptian General Petroleum Corporation.
The Egyptian General Petroleum Corporation had signed a twenty-year franchise agreement with the National Gas Company on January 6, 1999, to deliver natural gas to residential, commercial and industrial areas and to power plants in Al-Sharqiya Governorate. The company was committed to calculating and collecting the value of the gas sold to customers and consumers and to paying the authority's dues accordingly.
The other defendants named with Rasikh in Cairo Criminal Court case number 5298 of 2021 were two former chairmen of the board of directors of the National Gas Company, Mohammad Hani Ahmad Mohammad Farid and Hussam Ridha Junainah. The fugitive businessmen were accused of refusing to grant the Egyptian General Petroleum Corporation its dues from the gas value collected from consumers, estimated at one billion Egyptian pounds.
The ARIJ obtained a copy of the attached records of the Administrative Oversight Authority on the referral to the Supreme Prosecution Department for Public Funds. The records reveal that the company fulfilled its obligations up to 1 July, 2010. After that, it failed to provide the authority with its dues for the value of the gas obtained from customers. It also refused to sign the approvals for the quantities and values of gas consumed. This conflicted with the contract signed between the two parties, which expired on 20 January, 2019. The investigations of Ahmad Muhyi Al-Din Al-Qadi, a member of the Administrative Oversight Authority and the seventh witness in the case, show that the responsibility fell on the defendants and a now deceased person.
The legal dispute is ongoing between the Egyptian government represented by the Egyptian General Petroleum Corporation, and the National Gas Company. Despite the 2019 expiry of the contract, the document on gas delivery procedures on the official website of the Ministry of Petroleum still lists the National Gas Company, along with its address and contact information, as one of the companies that deliver natural gas to homes and industrial areas.
Magdy Rasikh, the National Gas Company and Fleet Energy
This investigation found that Magdy Rasikh deceived the Egyptian government for more than ten years by obtaining agreements and deals from the Ministry of Petroleum to import natural gas and supply it to homes and factories. This is similar to the activities conducted by his first company, National Gas, but conducted by another company called Fleet Energy, which was founded in Panama in 2007 with an office in Dubai.
Rasikh's name appeared in the Fleet Energy documents alongside the name of Essam Kafafi who is the company's chairman of the board of directors. Fleet Energy has many wholly-owned subsidiaries, including Fleet Energy Hydrocarbons, Ltd. DMCC; Fleet Offshore Petroleum Services; Fleet Fuel FZC; Fleet Tanking Inc.; and Fleet Oil and Gas SA. One of the documents on "the Agent's Confidential Information" lists Mohammad Magdy Hussein Rasikh's personal details with passport number xxx19; date of birth 23 December, 1943; and residence 26 Mohammad Ghuneim Street, Heliopolis, Cairo. They show that "Magdy Rasikh" founded Fleet Oil and Gas SA on 16 January, 2008.
The documents reveal that Rasikh is the beneficial owner of Fleet Oil and Gas SA through the office of Alemán, Cordero, Galindo and Lee Trust Belize Limited. Kafafi is listed as the company's current representative client of record.
According to the company's official website, its main office is in Dubai in the Abraj Buhairat Jumeirah area. It also has offices on 261 Street in the Ma'adi neighbourhood in Cairo, and in Moscow.
The Fleet Energy website states that the company is an active trading partner with the following: the Russian Rosneft Company and its subsidiary Rosneft Trading in Geneva; Shell for Trading and Shipping; Kaz Monai Gas in Kazakhstan; Rom Petrol in Romania; OMV for Supply and Trade Ltd.; the Egyptian General Petroleum Corporation (EGPC); the Egyptian Natural Gas Holding Company (EGAS); the Spanish Petroleum Company; Luke Oil in Russia; Libya Oil; the Kolmar Group Shareholding in Bulgaria; Petrosa in South Africa; Petro China; Saras S P E in Italy; Enok for Supply and Trade in the United Arab Emirates; and the Aden Refineries. This is in addition to other private and state-owned refineries, wholesale distributors and traders. The company's clients include national oil companies in countries in North and East Africa, such as the National Oil Corporation in Libya.
In July 2015, Magdy's right-hand man Kafafi, the commercial partner of the Russian Rosneft Company, was present when the Egyptian General Petroleum Corporation and the Egyptian Natural Gas Holding Company (EGAS) signed two term documents with the Russian Rosneft Company for the supply of petroleum products and liquefied natural gas to Egypt. On 6 May, 2016, Rosneft delivered its first shipment of liquefied natural gas to Egypt.
Fleet Energy worked with the Egyptian government in 2010, and the company was granted the right to process between 1 and 1.5 million barrels of crude oil per month at the Maydour Refinery. It made successive sales operations of products that had been produced for the Egyptian General Petroleum Corporation. Fleet Energy confirms that it has an excellent working relationship with the EGPC.
In 2014, 510,000 metric tons of gasoline and gas oil were sold to the Egyptian General Petroleum Corporation through Fleet Energy's strategic partners.
All transactions in 2015 were fulfilled on a bid basis, either individually or through the company's partner Rosneft Trading, with a total supply volume of around 450,000 metric tons of cargo primarily containing fuel oil and gas oil. These were delivered to the General Petroleum Corporation's Al-Ain Al-Sokhneh, Suez and Alexandria ports.
Fleet Energy confirms that it is currently part of the direct supply network between Rosneft and the Egyptian General Petroleum Corporation in providing petroleum products and crude oil in addition to supplying liquefied natural gas with EGAS. During 2016, more than 1.5 million metric tons of liquefied natural gas and petroleum products consisting of fuel and gas oil were supplied to Egypt.
In July 2017, the Egyptian Natural Gas Holding Company granted Fleet Energy the initial approval to import liquefied natural gas.
Granting these initial import approvals lined up with the issuance of the law on regulating the gas market in August 2017. Chapter 2 of article 36 of this law allows the private sector to import gas from abroad for the first time when this role had previously been limited to the government. This took place a few weeks before Egyptian President Abdel Fattah Al-Sisi ratified the law on regulating gas market activities, which was published in the Egyptian Gazette in early August 2017.
In May 2018, on the sidelines of the 22nd Saint Petersburg International Economic Forum, Rosneft signed a framework cooperation agreement with Fleet Energy and Fleetliner Energy SA. The parties declared the intention to explore the possibilities of creating a joint project to develop a supply chain to provide more gas to industrial consumers in Egypt.
The case of the SODIC land
Magdy Rasikh's problematic financial relationship with the Egyptian state is not limited to the oil sector.
On 20 February, 2021, the Public Prosecution announced on its official Facebook page, that the National Committee for the Recovery of Funds and Assets Abroad signed a contract to settle and reconcile with the defendants Mohammad Ibrahim Suleiman and Mohammad Magdy Hussein Rasikh who faced charged in a number of cases.
The committee was headed by consultant Hamada El-Sawy, who is also the Egyptian Public Prosecutor. It signed the settlement and reconciliation applications filed by the defendants Suleiman and Rasikh. The defendants paid a total of 1,315,701.24 Egyptian pounds.
On 21 December, 2016 and while Rasikh and Kafafi's company was signing oil agreements with the Egyptian government, the Egyptian Court of Cassation was in the process of ruling in favour of the indictment issued by the Cairo Criminal Court on 21 September, 2015. Through this ruling, Mohammad Magdy Hussein Rasikh, chairman of the board of directors of the Sixth of October Development and Investment Company (SODIC), was sentenced in absentia to five years in prison. This was the final verdict in the SODIC case in which the court charged the defendants with profiteering and intentional harm to public funds.
In his role as chairman of the board of directors of the Sixth of October Development and Investment Company (SODIC), Rasikh was accused of acquiring many plots of land in the cities of Sheikh Zayed and Al-Giza Al-Jadeedah at prices below their market value. To do this, he colluded with Suleiman, former Minister of Housing, Utilities and Urban Communities, and some officials of the New Urban Communities Association.
A document in the Panama Papers dated June 2015 reveals that Rasikh was granted a Power of Attorney and was appointed as a legal representative for Fleet Energy Inc. By this, he could act individually in the name of the institution and on its behalf in any and all its trading activities globally when necessary. From 12 February, 2010, he could also carry out any and all representative actions that the company itself could do. These are the same powers that were granted to Essam Kafafi on 17 July, 2009. Kafafi holds a British passport, number xxxxx0988, and is the chairman of the board of directors.
A letter from Panama law firm Alemán, Cordero, Galindo & Lee S A to Kafafi on 25 March, 2010, states that, according to Kafafi's instructions, Mohammad Magdy Hussein Rasikh was granted a general Power of Attorney certified by the Egyptian Consulate, and a bank account was opened. The company lists the same address as Rasikh's contact details on 26 Mohammad Ghuneim Street, Heliopolis, Cairo.
Another document dated 12 February, 2010, on the meeting of the board of directors of Fleet Energy, Inc. shows that a bank account with Euro Bank EFG, Cyprus was opened. This is operated individually or jointly by Messrs. Essam Jamal Kafafi and Mohammad Magdy Hussein Rasikh, and they are authorised to sign documents and withdraw funds from this account and to manage any other transactions of any kind with Euro Bank EFG, Cyprus on behalf of Fleet Energy, Inc. They are given full powers, including the authority to activate any alternatives they may deem suitable or necessary.
Essam Kafafi's social media accounts show that he was born on 9 August, 1961, and that he obtained a Bachelor of Engineering degree at Helwan University in 1986. From 1996 to 2000, he was the chairman of the National Gas Company, which was founded by Magdy Rasikh. He then moved to manage a company for developing projects in the Middle East in Dubai between 2000 and 2007. After that, he founded Fleet Energy and is currently the chairman of the board of directors.
The case against Rasikh is as follows: How does the Egyptian Ministry of Petroleum grant these private agreements on supplying gas and expose the Egyptian market to activities by a company run by businessman Magdy Rasikh who is nominally represented by Essam Kafafi? This was also happening at a time when Rasikh was facing a five-year prison sentence after being convicted for profiteering and intentional harm to public funds. Rasikh is currently on trial before the Cairo Criminal Court along with others on charges of refusing to provide the Egyptian General Petroleum Corporation's dues with the value of gas collected from consumers, which are estimated at one billion Egyptian pounds.
At the time of publication of this investigation, Rasikh, Kafafi and their companies had not responded to our requests for comments.
Update: This page was updated at 07.10 BST on 6 October 2021 to remove non-functional references.
The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.