Australian police on Wednesday arrested a man in connection with US$78 million in bribes used to secure lucrative Iraqi oil contracts linked to an alleged international corruption ring.

Local media named the man as former Leighton Offshore managing director Russell Waugh.

Police claim his company paid bribes through contractors including Unaoil -- a Monaco-based firm which last year had two former senior executives plead guilty to being part of a scheme to bribe foreign government officials in several countries including Azerbaijan, Syria and Iraq. 

Investigators believe the payments were used to secure contracts to build oil pipelines worth roughly US$1.5 billion. 

"The key targets of the bribery scheme were Iraqi Ministry of Oil officials and government officials within the South Oil Company of Iraq," Australian Federal Police said in a statement announcing the arrest of a 54-year-old in Brisbane.

They said the investigation, which spanned nine years and involved US and UK authorities, was a "painstaking process" of piecing together a worldwide jigsaw of "alleged corruption".

Police also announced they had issued two further arrest warrants for men living overseas.