No surprises as Bonnici Group manages to submit the lowest incinerator bid

There were no surprises this morning at the Department of Contracts when the Best and Final Offers (BAFO) for one of the largest-ever government tenders, worth hundreds of millions of euros, were unsealed.

As expected, following a ‘blunder’ earlier in the process that possibly compromised the entire tender, the French Paprec Energies Consortium – the only one of the final contenders in which a Maltese company is a shareholder – submitted the lowest bid for the project at €600 million.

Maltese road builders Bonnici Group, which has no experience in the complex incineration business, holds a 40% stake in the consortium.

Its managing director, Gilbert Bonnici, was in the past a business partner of Prime Minister Robert Abela for a construction development project in Iklin – earning him hundreds of thousands of euros from property speculation just weeks before he became Labour Party leader.

The Group was also a client of Abela’s private legal office and has received millions of euros in direct orders in recent years.

Robert Abela with the Bonnici Group’s Gilbert Bonnici soon after the former became Prime Minister.

In its final submission, which now will be evaluated and negotiated by a government-appointed evaluation committee, the Paprec/Bonnici consortium’s final price (€600 million) is a few million less than its original indicative price of €617 million.

In the latest developments, the real surprise came courtesy of two other international consortia, which had originally indicated much lower prices than that of the Bonnici Group and which have now abandoned interest in the multimillion-euro project.

The companies that withdrew their bids at the eleventh hour were Maghtab Gdid Energija Nadifa (€395 million) and Sacyr Industrial Operacion (€422 million).

While they have not given a reason for their withdrawal even though they appeared to have been in pole position for the tender, industry sources told The Shift that the move might be a result of international mergers or because they “smelled a rat”.

“What has already happened in this process is irregular and unprecedented. You cannot just publish sensitive information that gives an advantage to competitors. This may lead to problems, including legal challenges, but one has still to see,” the sources said.

The move had raised eyebrows among the tender’s observers, who described it as a ‘mistake’ that is “compromising the whole process.”

Former MP Jason Azzopardi had, in fact, publicly called out the incident as a “planned mistake aimed to give an advantage to a particular company close to the Prime Minister”.

The withdrawal of the two international consortia opens the way for the Paprec/Bonnici consortium to win the tender, which was originally budgeted at €400 million – €200 million for the installation of the incinerator and another €200 million for its operation for the next 20 years.

Although the Paprec/Bonnici consortium’s bid is now the lowest of the three final bids submitted today, it is still €200 million more than the tender’s estimated value.

According to the final BAFO list published by the Department of Contracts, two other offers were submitted.

FCC Medioambiente Ineternacional S.L.U – another Spanish multinational, which did not indicate its price the last time around, submitted a bid of €617 million, which was slightly higher than that of Paprec/Bonnici.

On the other hand, Hitachi Zasen Inova AG together with Terna S.A. made a final offer of €781 million.

According to the process, a government-nominated evaluation committee will now start negotiations to nominate a preferred bidder.

The Office of the Prime Minister is said to be closely monitoring the evaluation committee’s work but has so far not named the committee’s members.

The Shift has already revealed how the enormous tender was seen to have been compromised when the Department of Contracts ‘mistakenly’ published sensitive information mid-way through the process.

Still, the government ignored advice to start the competitive tender afresh and moved forward with the process.

It is not yet known when the waste-to-energy incinerator will be up and running. In the meantime, Malta is facing stringent EU waste management targets that it is nowhere near achieving. The incinerator project is expected to drastically reduce the amount of waste sent to landfills.

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1 month ago

Are EU funds to be made available?
More EU funds – more corruption.

1 month ago

just daily malta mafia things. abela need new yacht. nothing to see here.

Francis Said
Francis Said
1 month ago

Absolutely disgusting. The whole process stinks.

1 month ago
Reply to  Francis Said

ANYTHING involving Abela stinks!

1 month ago

This is a fraudulent as it goes.
An exact replica of the Electrogas selection.
The only difference is that there will not be Daphne Caruana Galizia digging out the shit.
A car bomb put paid to such nosing around.

1 month ago

The Shift should also investigate the environmental damage an incinerator causes. A few years back Malaysia revoked a signed contract after the government had to listen to the protests of the people. Apart from the environmental damage, Minister Caruana should not that it will be a veritable fire place for the country’s coffers. Did anyone work out a cost/benefit exercise? Or will this government just keep burning our money?

1 month ago

Do a search on this project. Incineration continues to kill our air with POPs

The documentary tells the story of how the determined citizens of Broga fought the
relocation of the largest incinerator of its type in Asia. It is told through Alice Lee, who
comes from a farming family in Broga.
Broga is located some 50 km on the outskirts of Kuala Lumpur, the capital of Malaysia,
Straddling the states of Selangor and Negeri Sembilan, Broga is a mainly farming
community, consisting of 80,00 people, the majority of whom are of Chinese ancestry,
minorities of the majority-led Islamic Malay country.
Alice was instrumental in bringing the fight to court, culminating in a “stop work order” to
halt the construction of potentially the largest ‘gasification fusion furnace’ incinerator in
She was the first to realize the impact the 1,500 tonne-capacity plant would have on her
community and so, she mobilized them to oppose the project. 

1 month ago

I remember speaking to a turkish friend of mine, who was involved in the bidding for the Marsa junction construction project. He and his fellow company directors, were horrified at the amount of kickbacks they were being asked for, and promptly pulled out of the bidding. So imagine the same happening here, with the really cheap bids not having any kickbacks factored in? How could these uncooperative bidders be removed from the process? Make a “mistake” halfway through the process, and off they go, leaving the field clear for the cooperative bidders. After all, the poor Bonnicis need the funds for their Wardija Villa. It costs money to triple the size of a barn, transform it into a luxury dwelling, while at the same time covering the neighbouring fields in spoil and soil, to hide all the unsightly garigue. Oh, where is the EU and its fraud office when you really need them?

D. Borg
D. Borg
1 month ago

Anyone taking bets on who will be sitting on the Board of the Bonnici Group and/or engaged as a “consultant” in some years’ time?

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