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Oil Contracts Scandal Snares Peru Energy Minister

Peru's energy minister has resigned over allegations that key government officials were accepting kickbacks in exchange for steering lucrative oil contracts to a Norwegian-based company.

Energy Minister Juan Valdivia quit Monday, one day after a local television program aired a audiotape of a conversation between Alberto Quimper, a high-ranking official in the state energy agency Perupetro, and a member in President Alan Garcia's APRA political party.

The conversation involved Discover Petroleum, which was recently awarded four separate oil contracts.

Quimper and Cesar Gutierrez, the head of the country's state oil operations company, have been forced from their positions because of the scandal.

Government officials say the contracts awarded to Discover Petroleum have been suspended.

Some information for this report was provided by AP and Reuters.