The public accounts committee today slammed witness Paul Apap Bologna for being unable to explain contradicting clauses within service agreements related to the project.
The meeting this afternoon highlighted a series of anomalies in the contracts between the various shareholders in the controversial Electrogas project, including the consortium GEM Holdings, consisting of Apap Bologna’s company, the Tumas Group Fenechs, and the Gasan business family as well as Yorgen Fenech in his own right.
Fenech, since accused of masterminding the murder of journalist Daphne Caruana Galizia, was also the owner of Dubai company 17 Black, the kickback company registered in the Ajman Free Zone that Caruana Galizia was investigating.
Committee chairman Beppe Fenech Adami and member Karol Aquilina questioned why GEM Holdings, which Apap Bologna directed, was set to pay Yorgen Fenech’s New Energy Supplies Ltd €1 million in development fees.
Apap Bologna said GEM Holdings was to provide €1 million of a total fee of €2.5m, with the rest being paid by Gasol, another shareholding company.
He argued that the project services agreement connected with a payout to Fenech was signed by all the shareholders involved in the consortium.
“The scope of this agreement was to detail the specific services which had been assigned to GEM and to Gasol. GEM assigned those services under that agreement to New Energy,” he added.
Two of the agreements Apap Bologna was referring to, dating back to August 2013 and June 2014, were not originally submitted to the committee, with further requests for submission of documents being made.
This was not the first time previously withheld contracts eventually emerged, painting a clearer picture of the “back-to-back” agreements signed between the shareholders. In October of last year, news reports exposed how Electrogas shareholders had awarded themselves a total of €16 million in success fees.
Although the witness argued that the agreements are not solely his property but are also owned by the other shareholders and that “etiquette demands” that he “ask for their consent”, the committee insisted on the relevance of the documents and their submission.
Apap Bologna stated that the decision to hire Fenech’s New Energy Supplies (NES) for the management of the project was based on Fenech’s involvement in the coordination of the project “from the very beginning”.
Meanwhile, similar to the hearing held two weeks ago, Labour MP Glenn Bedingfield repeatedly took aim at the committee chairman’s line of questioning, arguing that there was disregard for the rights of the witness and accusing Fenech Adami and Aquilina of attempting to impose their “opinions” on the witness.
The witness’ lawyer, Giannella de Marco, also intervened multiple times, at one point stating that the courts had ordered committee members to steer away from “politically loaded and biased questions”.
Other Labour MPs spent a significant chunk of the sitting on their phones as Fenech Adami repeatedly informed them that their questions should be reserved for the latter part of the proceedings in which they could do so.
A large part of the questioning that did occur referred to specific points within the project services agreement, with Aquilina and Fenech Adami suggesting Apap Bologna and the rest of the shareholders may have created agreements for the sake of having a plausible explanation for the payments given to Yorgen Fenech.
Aquilina and Fenech Adami especially emphasized the contradiction in a clause stating that GEM had agreed to pay NES for a service that it was itself providing, according to the contract.
Apap Bologna refused to furnish further explanations, arguing that he had already explained that although he had signed the contract, he wasn’t the one who authored it.
“Everything we have done is in the books, I don’t accept being accused about this,” the witness said.
“You are trying to put words in my mouth, you are turning questions over and over to try and influence me. I told you exactly what happened,” Apap Bologna added.
When reminded that Yorgen Fenech was also a shareholder at GEM Holdings at the time the agreement was signed, the witness’ lawyer stepped in to argue that the question was not within the committee’s remit, a line of defence that was used several times throughout the proceedings.
Another contractual clause that was highlighted by the opposition’s MPs was related to the timing of the pay-outs to be given.
While the witness insisted that all the contracts need to be presented and looked at together, Apap Bologna did say that the pay-out was scheduled to be given either when the interim bridge loan to fund the project came through or when the project was completed.
The bridge loan was referring to the hefty sum loaned to the project, with the government providing an “unprecedented” guarantee of €360 million on the project.
No concise explanation as to why a clause regulating a key financial pay-out of the project was left open to an either/or situation was given.
The chaotic hearing came to an end when Aquilina was pressing the witness to explain why Gasol and GEM Holdings had agreed to a pay-out to Fenech but SOCAR and Siemens had not.
De Marco and Bedingfield leveled further accusations at Aquilina and Fenech Adami, arguing that the witness could not be privy to information related to any agreements that may exist between SOCAR, Siemens and Fenech’s NES.