Electrogas PAC grilling: Konrad Mizzi refuses to answer when he got to know Yorgen Fenech

Another stormy meeting of the Public Accounts Committee sees former energy minister Konrad Mizzi insisting he will only answer questions linked to the National Audit Office report

Konrad Mizzi (centre) is testifying in front of parliament's Public Accounts Committee (Photo: James Bianchi/MaltaToday)
Konrad Mizzi (centre) is testifying in front of parliament's Public Accounts Committee (Photo: James Bianchi/MaltaToday)

Konrad Mizzi refused to answer when he got to know Nexia BT’s Brian Tonna and Yorgen Fenech when grilled on the Electrogas tender by parliament’s Public Accounts Committee.

Mizzi also refused to say when he got to know two other foreign consultants who formed part of the evaluation committee that awarded the power station tender.

Opposition members on the PAC asked Mizzi whether he met Tonna, David Galea and two foreign consultants from DNV Kema before the 2013 election as part of the Labour Party’s efforts to prepare an energy plan. They also asked when Mizzi got to know Electrogas shareholder Yorgen Fenech.

But the former energy minister kept insisting that he will not answer questions irrelevant to the NAO report. Mizzi said the NAO made it clear it did not have the remit to probe a political party.

“I will not answer questions unrelated to the NAO report… your questions are irrelevant and not objective as requested by the Speaker’s ruling,” Mizzi repeated, accusing the Opposition of putting “leading and loaded” questions.

The former minister insisted that he had not appointed the evaluation committee that decided on the power station tender but this was the remit of Enemalta. When it was pointed out that he was present for meetings of the Enemalta board, Mizzi said he was only present as an observer to serve as liaison between the State energy company and Cabinet.

Yorgen Fenech
Yorgen Fenech

Yorgen Fenech exchange

Mizzi also refused to answer about an alleged exchange of messages he had with Yorgen Fenech in 2019 after the latter lost his mobile phone in America.

Aquilina asked: “Why did you ask him repeatedly to put your mind at rest that all messages exchanged between you were deleted?”

Mizzi hit back asking Aquilina how he ended up in possession of Fenech’s messages, suggesting collusion between the police and the PN MP.

Mizzi then went on to criticise PAC chair Beppe Fenech Adami for his handling of proceedings.

“What chairman are you, Beppe Fenech Adami. You’re chairing a circus. This is not about the NAO report,” Mizzi insisted.

The tense PAC meeting was characterised by frequent tit-for-tat exchanges between Mizzi and the Opposition members.

Mizzi teased Fenech Adami about an alleged deal concerning the Pieta boathouse and how this was transferred to a certain John Debono to be transformed into the restaurant Vecchia Dogana. Mizzi kept accusing Fenech Adami of being a sleeping partner in several businesses by using Debono as a front.

Fenech Adami denied the accusations and insisted Mizzi did not know what he was talking about.

Mizzi also hit out at PN MP Ryan Callus, accusing him of skiving his government job and abusing public funds. Callus rebutted that he always did the work assigned to him.

At one point, Aquilina hit back at Mizzi, telling him that he is unable to travel to the US for a holiday unlike others around the table.

The reference was to a US government sanction preventing Mizzi, Keith Schembri, Yorgen Fenech and their respective families from entering the US because of their links to high level corruption.

Excise tax pardon

Mizzi was asked about his involvement as minister to waive €40 million in excise duty due by Electrogas, an expense that was eventually passed on to Enemalta.

However, Mizzi insisted he never intervened in the negotiations which were taking place between Electrogas, an Enemalta negotiating team and banks.

The reference was to a leaked email exchange between Electrogas shareholders and officials that expressed concern over the excise tax and how this could financially derail the project. In the exchange, Konrad Mizzi’s name was dropped by Fenech, who said that he had a meeting with the minister.

“I did not intervene because there was a negotiating team dealing with the matter,” Mizzi insisted, refusing to reply whether the issue was eventually resolved. “The NAO report does not mention the excise tax issue.”

Asked specifically whether he personally intervened to waive the tax due by Electrogas, Mizzi replied: “This is a leading question and not something that forms part of the NAO report… At the time, there were discussions going on between Electrogas, the negotiating team and banks to ensure the contract was bankable. The tax issue was one of many issues. The teams closed the issues. I did not close anything.”

Another PAC meeting is scheduled for Tuesday, 15 February, and Konrad Mizzi is expected to continue testifying.

What is the Public Accounts Committee doing?

The PAC is examining the findings of the National Audit Office’s investigation into the award of the Electrogas tender. The NAO report was published in 2018 and flagged several concerns, although it found no evidence that the project was a done deal.

Some of the key findings of concern flagged by the NAO include:

Last-minute inclusion of Security of Supply agreement, which “significantly reduced” risk for final two bidders

The bank guarantee provided by the government to Electrogas was irregular in terms of the guidelines applicable at the time 

Interconnector prices were far cheaper than those from the Electrogas power plant

However, since the NAO report, one of the Electrogas shareholders – Yorgen Fenech – was charged with being behind the murder of journalist Daphne Caruana Galizia.

Fenech was also uncovered as the owner of Dubai-based company 17 Black, which had been listed as a target client for the Panama companies set up by former energy minister Konrad Mizzi and former OPM chief of staff Keith Schembri.

The PAC is summoning witnesses to testify about the deal.

PN MP Beppe Fenech Adami chairs the PAC
PN MP Beppe Fenech Adami chairs the PAC


PL working group

Beppe Fenech Adami (BFA): Who were the members of the Labour Party working group before the 2013 election?

Konrad Mizzi (KM): It is not my role to speak on behalf of the Labour Party… may I remind you of the Speaker’s ruling that called on committee members to put all the necessary questions linked to the matter being probed, and these questions have to be objective.

BFA: How many of those involved in the PL working group were later involved in the award of the Electrogas tender?

KM: This was not in the NAO’s remit and I will not answer.

David Galea

BFA: Was David Galea, who was in charge of the evaluation committee that awarded the tender, also involved in the PL’s pre-election preparatory work on energy?

KM: I can only speak for myself… yours is not an objective question because it is unrelated to the NAO report.

BFA: You appointed David Galea as chairman of the committee that awarded the tender. Did you know David Galea well?

KM: This is not relevant to the NAO report… From some research I did, David Galea used to work at OPM under a Nationalist government and held various posts and received various direct orders as a consultant under Nationalist administrations.

BFA: What was your relation with David Galea in the private sector?

KM: I had no relation with him in the private sector. Not that I remember… But we are here to discuss the NAO report.

Karol Aquilina (KA): David Galea testified that before the 2013 general election he gave input to Labour Party on its energy plans. Did you meet and discuss with Galea the energy plan before the election?

KM: This has nothing to do with the NAO report. The auditor general said he had no remit to investigate a political party.

KA: Who suggested Galea’s name after the election to form part of the evaluation committee?

KM: Read the minutes and you will see.

BFA: You were there.

KM: I was only there as an observer… my role in these meetings was to monitor what was happening and serve as liaison between Enemalta and Cabinet.

KA: Who chose David Galea?

KM: David Galea is known as a competent person. The PN appointed him in at least 10 posts and he had worked with Enemalta.

KA: Do you know Thomas Lennard [from DNV Kema, a consultancy firm]?

KM: He was involved in the RFP process.

KA: Did you meet Thomas Lennard before the 2013 election?

KM: I will not answer about things unrelated to the NAO investigation… it is an irrelevant question and not objective.

Carol Peralta (CP): The advice to my client is not to answer these questions.

BFA: What is the problem?

KA: Did you personally meet Thomas Lennard before the 2013 election?

KM: The question is not objective.

BFA: It is relevant to know whether these people were known to you before the election.

DNV Kema

KA: When did you have contact with DNV Kema?

KM: DNV Kema were used by Enemalta as consultants before the 2013 election under a Nationalist administration just like David Galea was appointed consultant by the corporation before.

BFA: The people you sat down with after the election when you were a minister responsible for this project; did you sit down with them before the election?

KM: I am not here to speak about the workings of a political party. I am here to discuss my work as a minister after March 2013… the question is irrelevant. We can stay here until the end of the world but I will not answer questions unrelated to the NAO findings. The NAO made it clear it had no remit to investigate a political party.

KM: I did not appoint David Galea.

Ryan Callus (RC): Enemalta minutes show you were present for meetings in 2013 when the members of the evaluation board were chosen.

KM: I was only an observer in the meetings and did not appoint anyone.

KA: This committee has established that three of the evaluation committee members – David Galea, Sven Later and Thomas Lennard, and also Brian Tonna – were involved with the Labour Party before the 2013 election to draw up the energy plan. When you became minister and these were appointed to the evaluation committee did you not see this as being problematic?

KM: NAO report states clearly that people appointed to the evaluation committee were competent. NAO said competence of members was ascertained… [he goes on reading verbatim from the findings of the NAO report, ignoring questions from the Opposition]

Undignified behaviour

BFA: I ask the committee members whether Mizzi’s reply, which is akin to another prepared statement, is censorable and should be condemned.

Glenn Bedingfield (GB): We have allowed you to ask all the questions you want but if the chairman is insisting on a decision, I will then insist on a decision condemning the undignified behaviour of Opposition members on the committee.

The cancer exchange

KM: With the project, we put a stop to the use of heavy fuel oil, which was causing cancer and respiratory problems to the people of Marsaxlokk…

BFA: You should be ashamed of using cancer to justify this project. You should be ashamed. You have hurt a lot of people with your words. You should be ashamed.

KM: Heavy fuel oil is known to cause cancer and illness and we stopped it… that is what I intended to say…

KA: I lost my parents to cancer, so let us be more sensitive.