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Opposition demands government withdraw direct order on Electrogas deal

electrogas LNG Malta
The LNG tanker in Malta.

The Opposition has called on Energy Minister Michael Farrugia to withdraw a €6,000 direct order issued to BEAT Ltd, a company that was central to the awarding of the highly criticised Electrogas deal, to review the Auditor General’s report on the same deal.

Last week, The Shift revealed how BEAT Ltd, in which former Minister Konrad Mizzi’s friend David Galea was a majority owner, was deeply involved in the adjudication process of the power station deal awarded to Electrogas. The company was therefore given a direct order to review a process in which its owner was deeply involved and had a conflict of interest in terms of assessing the Auditor’s findings.

The Opposition said in a statement that Enemalta’s decision to issue a direct order to BEAT Ltd, with the Labour government’s blessing, went against all principles of accountability and good governance. 

Energy spokesman Ryan Callus and Good Governance spokesman Karol Aquilina said The Shift’s article confirmed that Prime Minister Robert Abela was following the footsteps of his predecessor Joseph Muscat and leading the country with “the most corrupt government in history”.

Enemalta, as a state entity, was obliged to observe the principle of accountability rigorously but instead issued another direct order to BEAT to review the damning auditor general’s report into the Electrogas deal and “cover it up”.

The company had already received €150,000 in direct orders for the adjudication of the tender for the construction of the new power station. This, in itself, created a huge conflict of interest between BEAT and individuals involved in the company, the Opposition said.

The Nationalist Party pointed out that the Auditor General’s report had highlighted a number of serious shortcomings in the adjudication of the power station tender.

“For this reason, this company and the government should never be trusted to address and replace, once and for all, the corruption which the Maltese are still paying for,” the MPs said.

They stressed that Galea was a very close friend of former Minister Konrad Mizzi who chose him to lead the most important committee that selected the bidding offers on the power station deal. Mizzi then chose Galea as the project manager to oversee its construction.

The Auditor General’s report had highlighted that Galea was inconsistent in his role, particularly when he excluded other bidders for a number of shortcomings. Electrogas was awarded the tender despite having shortcomings, the MPs said.

Galea has not publicly reacted to The Shift’s story, choosing his cluster on Facebook instead to say he would “stand strong and stand tall amidst this adversity”. He said he was available for questions to clarify the situation “in the proper fora” of his choosing, following the standard rebuttal of the Minister who had appointed him.

The Nationalist Party pointed out that the power station selection committee also included Nexia BT, the financial consultants to Mizzi and former chief-of-staff Keith Schembri. Nexia BT also sat on the board that selected US hedge fund Vitals Global Healthcare to run three of Malta’s hospitals, the Opposition said. 

“The Nationalist Party expects Minister Michael Farrugia, who is responsible for Enemalta, to withdraw the direct order issued to BEAT to try and cover up the situation.”

The Opposition said Farrugia also had to ensure that BEAT and Galea had no involvement whatsoever in the power station project and the Auditor General’s report.

Yorgen Fenech, one of the shareholders of Electrogas, was also the owner of 17 Black and facing criminal charges for the assassination of journalist Daphne Caruana Galizia in October 2017.

“The Nationalist Party expects that the conclusions of the Auditor General on the power station should be observed and respected by the government that should stop abusing from public funds to cover up Malta’s biggest monument to corruption,” they said.

Read the investigation: Firm involved in Electrogas scandal gets direct order to review audit report… on the same scandal

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