Electrogas shareholder denies collusion with Labour, in PAC hearing

Electrogas shareholder Paul Apap Bologna denies collusion with Labour Party ahead of 2013 election that paved way for Delimara gas plant

Electrogas shareholder Paul Apap Bologna arriving in court to testify in Daphne Caruana Galizia public inquiry (Photo: James Bianchi/MaltaToday)
Electrogas shareholder Paul Apap Bologna arriving in court to testify in Daphne Caruana Galizia public inquiry (Photo: James Bianchi/MaltaToday)

Electrogas shareholder Paul Apap Bologna testified in front of the Public Accounts Committee on Wednesday, denying any collusion with the fovernment over the power station bid.

Nationalist MP Ryan Callus highlighted that the Labour Party had unveiled its project for a new gas plant in 2012, and questioned Apap Bologna’s sincerity over his denial.

Accompanied by lawyer Giannella De Marco, Apap Bologna said that he was never investigated by the police over the Electrogas project and that he “never bribed anybody anything in my life in relation to the project”.

Apap Bologna said the choice for a gas-powered power station had “less to do with technology and more with gas being cheaper than oil at any given point”. He remarked that the original plans for the power station were for a 400 MW plant and an interconnector, so that Enemalta could sell electricity to Italy. “The proposition was only similar in structure but not in technicality,” Apap Bologna said.

Apap Bologna admitted that the project later ran into financing issues and overruns, highlighting an €11 million bank guarantee fee that had to be paid for.

Gasol financial difficulties

Apap Bologna said Electrogas was not aware of one-time sharheolder Gasol’s financial difficulties, and got to know of this when the shares were transferred to the rest of the shareholders.

Fenech Adami asked the witness about news in 2014 that Gasol has lost 55.84% of its value in a year. “We eventually found out later on and I was not privy to what was happening. Gasol was guaranteed by SOCAR and supported by other companies,” said Apap Bologna.

The PN MPs questioned this, with Fenech Adami stating that he found Apap Bologna hard to believe, when “the company [Gasol] was on the brink of failure”.

“Everyone, including Siemens and SOCAR were happy to have Gasol on board,” Apap Bologna emphasised.

Shouting matches and right to invoke silence

Shouting matches have become synonymous inside the PAC, this time with disagreement as to whether the NAO report on the Delimara planbt had inferred the contract was “tailor-made” for Electrogas.

Labour Whip Glenn Bedingfield accused PAC chairman Beppe Fenech Adami of misquoting the NAO report, calling him a liar. Fenech Adami insisted that he had no issue saying the contract was laid out “precisely” so that the Electrogas consortium would be chosen.

Aquilina asked Apap Bologna about meetings held by the Gasan-Fenech company GEM holdings in the wake of the Panama Papers. “From what I recollect, we did not discuss people or companies, but that the news had broken out.”

Apap Bologna invoked his right to silence when he was questioned about actions taken and meetings when the 17 Black story – showing the connection between Electrogas shareholder Yorgen Fenech and the Panama companies held by former energy minister Konrad Mizzi and the PM’s chief of staff Keith Schembri – broke out.

Nationalist MP Karol Aquilina asked whether Apap Bologna was present at meetings with Yorgen Fenech, but the businessman invoked his right to silence.

2006 plans for gas-powered power station

Apap Bologna said it was not up to him to interpret the PN government’s 2006 policy change to stick to heavy fuel oil and not move to gas for the new power station. He said he felt that LNG “would have been the way forward for Malta, being cheaper and more environmentally friendly.”

Apap Bologna said a paper prepared by UK experts from Gasolwas that Malta should move to gas electricity generation. Meetings were held with Prime Minister Lawrence Gonzi and ministers John Dalli, George Pullicino and Austin Gatt over the proposal. He however denied consulting with the Government and Opposition over the decision to stick to heavy fuel oil. “I know that Mr George Fenech had put together an LNG project proposal, at the same time as the BWSC tender was happening.”

Konrad Mizzi unable to attend

Former energy minister Konrad Mizzi’s lawyers Jean Paul Sammut and Carol Peralta informed the PAC on Wednesday 22 November, that Mizzi was still in hospital and could not attend due to health reasons.

PAC chairman Beppe Fenech Adami said that Tumas shareholder Ray Fenech presented the PAC, on behalf of Electrogas, with minutes of meetings of board of directors of Electrogas.

Fenech Adami said that parts of the document are blacked out, not leaving much to “extrapolate” from them.

He said that the way forward is to get the non-blacked out version.

The PAC has been rescheduled to Wednesday 1 December at 2pm.