SAO PAULO, Dec 14 (Reuters) - Brazilian prosecutors on Monday charged Jose Carlos Bumlai, a friend of former President Luiz Inacio Lula da Silva, with taking out a fraudulent loan from Schahin bank that they allege benefited the ruling Workers' Party.
The engineering branch of the Grupo Schahin, Schahin Engenharia, was awarded a contract to operate a drillship for state-run oil firm Petrobras in exchange for the bank canceling Bumlai's loan repayments, prosecutors said.
In a statement, prosecutors said Bumlai sought the help of Lula to finalize the Schahin contract on the Vitoria 10,000 drillship, potentially bringing Brazil's largest-ever corruption case closer to the former leader.
"Jose Carlos Bumlai was an operator for a political party, an operator for the Workers' Party," lead prosecutor Deltan Dallagnol told a televised news conference.
The Nov. 25 arrest of Bumlai, a powerful rancher who also controlled a sugar mill, also brought the case to Brazil's farm sector.
Dallagnol said loans from Brazil's state-run development bank BNDES to Bumlai's companies that were mentioned in the arrest order were being investigated and prosecutors were concentrating on the Petrobras connection.
The investigation is focused on the years 2006 to 2009.
Lula and his successor, President Dilma Rousseff, have denied participating in acts of corruption involving Petroleo Brasileiro SA, or Petrobras.
Bumlai's lawyer said in an email on Monday it was not normal for his client to be formally charged before he had the chance to tell his side of the story.
Grupo Schahin and Schahin Engenharia did not answer the telephone.
Prosecutors also charged three executives from Grupo Schahin and Bumlai's son and daughter-in-law, and laid additional charges against the former treasurer of the Workers' Party, Joao Vaccari, jailed since April, and former Petrobras executives Jorge Zelada, Nestor Cervero and Eduardo Musa.
Prosecutor Diogo Castor de Mattos highlighted what he called "a certain administrative incompetence" in Petrobras' awarding of construction and operating contracts for drillships.
Charges have been laid in relation to the Vitoria 10,000, Petrobras 10,000 and the Titanium Explorer, and Castor reiterated they would later be presented against an Ensco-Petrobras charter.
Dozens of executives from Brazil's top construction and engineering firms have been charged with bribery and money laundering and about 50 politicians are being investigated for receiving kickbacks.
On Monday, Judge Sergio Moro also sentenced Gerson de Mello Almada, former vice president of the engineering firm Engevix, to 19 years in prison for corruption, money laundering and racketeering. (Reporting by Caroline Stauffer; Editing by Peter Cooney)