Portuguese PM to address lithium probe as minister named suspect in graft case

By Catarina Demony, Patricia Vicente Rua and Sergio Goncalves

LISBON (Reuters) -Portuguese Prime Minister Antonio Costa is to address the country on Tuesday after prosecutors detained his chief of staff and named one of his ministers a suspect in an investigation into alleged corruption in lithium and hydrogen deals.

It is the latest scandal facing Costa since a controversy around state-owned airline TAP in January and opposition parties are calling for his government’s resignation following news of the investigation.

The prosecutor’s office said in a statement five people had been detained as part of the investigation, including Vitor Escaria, Costa’s chief of staff, and a business consultant. Local media named the business consultant as Diogo Lacerda Machado, a friend of Costa.

Over 40 searches were carried out on Tuesday at several government buildings, including Escaria’s office and the infrastructure and environment ministries, the prosecutor’s office said in the statement.

Costa’s office said he would address the nation at 1400 GMT. Earlier, it confirmed searches at Escaria’s premises, but declined further comment. Machado is yet to publicly comment and Reuters could not immediately reach him for comment.

Prosecutors are investigating alleged corruption and influence peddling in lithium exploration concessions in northern Portugal, a project for a hydrogen plant in the port of Sines and a mega data centre investment there.

“At stake may be … facts capable of constituting crimes of malfeasance, active and passive corruption of politicians and influence peddling,” the prosecutor’s office said.

Infrastructure Minister Joao Galamba and the president of the environment agency APA, Nuno Lacasta, were named as formal suspects and will appear before a judge, it added.

Galamba’s office and APA did not immediately reply to a request for comment.

“The prime minister must resign… the country is mired in corruption, rot, nepotism. The PM has dragged the country into a quagmire,” said Rui Rocha, president of the Iniciativa Liberal party.

During the investigation, the prosecutors said in the statement they became aware that the suspects used Costa’s name and authority to “unblock procedures” related to the deals. They added that the Supreme Court would look into Costa’s possible role in the deals.

The mayor of the town of Sines, Nuno Mascarenhas, was aslo detained, prosecutors said. Mascarenhas’ office did not immediately respond to Reuters’ requests for comment.

Costa met with President Marcelo Rebelo de Sousa on Tuesday morning to provide explanations and was meeting him again in the afternoon, SIC broadcaster said. Costa and the president’s offices did not comment on the meetings.

(Reporting by Catarina Demony, Patricia Rua and Sergio Goncalves; Editing by Andrei Khalip and Emelia Sithole-Matarise)