Joe Mizzi, the man at the centre of the Delimara power station extension controversy, last night denied he had influenced the decisions taken on the contract or that he had ever met any Enemalta official outside of official meetings.
Although Mr Mizzi represented Lahmeyer International on some contracts awarded by the Malta Resources Authority, he did not know that the company had been blacklisted internationally
He was giving evidence before Parliament’s Public Accounts Committee in the first of two sessions hearing a number of witnesses in connection with the Auditor General’s report on the award of a €200 million contract to Danish firm BWSC for the Delimara plant.
The AG had found no hard evidence of corruption and spoke of “smoke but no fire”.
The award of the contract to BWSC had become highly controversial because the Danish company’s tender provided for a fuel oil turbine over the cheaper and more environmentally-friendly gas turbine proposed by the Israeli firm Ido Hutney Projekt/Bateman.
Mr Mizzi, who was BWSC’s Maltese intermediary, had been accused by opposition MP Evarist Bartolo of arranging meetings between BWSC and top Enemalta officials in 2005, months before the formal tendering process got under way.
Answering questions under oath at the PAC yesterday, he said that during the tendering process he did not make any presentation to any minister.
In reply to a question by Infrastructure Minister Austin Gatt, he said he had never met any politician about the tendering process and declared that he had never approached anyone with any monetary offer or otherwise, or influenced any politician in the decisions taken. Neither did he meet any Enemalta officials except during official meetings.
He said he had no documentation relating to correspondence with BWSC because his computer system had jammed and he had to replace it. There was not a lot of correspondence and he did not keep a hard copy.
Answering questions by Mr Bartolo, Mr Mizzi said an e-mail he had written to the Danish company BWSC – on the need to contact someone in the hierarchy – was suggested to him by his employer John Rizzo at Associated Supplies Ltd who deemed that Mr Mizzi’s level of English was poor.
As technical adviser to BWSC, he had written an e-mail about Brent Everson who as representative for Barzilla was their competitor. Barzilla wanted to take part in the tendering process but Mr Everson had arrived three minutes after the submission of tenders had closed.
He said that an e-mail from BWSC without the company’s letterhead and dealing with technical literature on diesel engines was sent to him because his employer had requested it to explain the matter to a third person.
Mr Mizzi denied any intervention on the changes effected to the 2002 Legal Notice in 2008 (which changed emission levels) and BWSC officials did not discuss this with him. He had suggested to BWSC the names of four civil contractors and he had met with Nazzareno Vassallo after he had won the bid.
As an ASL employee he always dealt with Enemalta contracts. BWSC wanted him to work on the power station tender.
He said he never gone to the Contracts Department to influence changes in the Legal Notice. Nor did he intervene to change the tender specifications to reflect the amended Legal Notice.
Although he represented Lahmeyer International (an independent consultant engaged to evaluate the technology of the bids) on some contracts awarded by the Malta Resources Authority, he did not know that the company had been blacklisted internationally, that Lahmeyer and BWSC had jointly built a power station and that Enemalta had written to Lahmeyer. He only knew that Lahmeyer employed thousands of people, he said.
Earlier, former Enemalta chairman Engineer Alex Tranter denied having any conflict of interest in the power station extension tendering process. He said that as soon as he knew that Vassallo Builders were to be involved in the project he had discussed the matter with the Finance Ministry (then responsible for Enemalta).
He had acted according to the Code of Ethics for Public Service employees and had abstained from the process delegating his duties to the Deputy Chairman.
Answering a question by Mr Bartolo, Mr Tranter declared that he did not have any conflict of interest because he was employed with Caremalta Ltd which had nothing to do with the construction company whose main shareholder also was Mr Vassallo.
He said he was never involved in the tendering process but was involved in the long-term generation plan for Enemalta. Decisions on the tendering process were taken by Enemalta committees at different levels. He had appointed these committees in consultation with the ministry. Investigations on allegations that Enemalta personnel had passed on confidential information were probably made by the corporation’s CEO because at the time Enemalta did not have an internal audit section. He did not take part in the investigation and could not remember any details. He had replied to the Auditor General on these allegations because the letter had been sent to him as chairman. Mr Tranter said that Enemalta followed a logging procedure for every individual who called at the corporation. Mr Bartolo requested PAC chairman Charles Mangion to ask for logging documentation between November 2006 and May 2009 to be produced.
In reply to a question by Minister Gatt, Mr Tranter declared that he was never approached by any person with an offer of money or other incentive to influence the tendering process.
Former Enemalta CEO David Spiteri Gingell also declared that he was never approached with any monetary offer or incentive to influence decisions.
Mr Spiteri Gingell said that it was impossible for the power station extension to be powered by gas because Enemalta did not have the necessary infrastructure even though originally this was the intention. This could not be achieved before 2015. The change to allow the use of diesel over that of gas was made in the Legal Notice in 2005 and there was no contestation about the amendment. He knew nothing about BWSC wanting to change the Legal Notice. There was no political interference in the tendering process.
He regretted his mistakes as CEO including the choice of Lahmeyer International which was recommended by the MRA. He did not know that they were also BWSC’s agents nor did he know that Mr Mizzi also represented Lahmeyer International.
Mr Spiteri Gingell denied that the BWSC equipment was a prototype because there already existed a similar process elsewhere.
All Enemalta engineers and members of the Request for Proposal and Technical Evaluation teams declared that they had never been approached by anyone and offered any money or other incentives to influence the process. They were replying to questions by Minister Gatt.
Enemalta’ chief technical officer engineer Peter Grima told the PAC that the electricity long-term generation plan did not say in absolute terms that Enemalta had to go for a gas-powered station. It was decided that the tender document should be technologically neutral because Enemalta did not have the necessary gas supply. The situation remains unchanged. He said that in 2005 Enemalta discovered that the Legal Notice issued in 2002 was not in compliance with the European Commission’s directive. This objection was raised in 2006.
On screening the bidders, Mr Grima said that Enemalta followed Public Procurement Regulations which envisaged that bidders were disqualified if they had been blacklisted by local legal authorities.
Mr Grima said that the Enemalta Head of Procurement had made a genuine mistake when he did not inform the bidders individually about the tender award. According to regulations he was only bound to publish the result on Enemalta’s notice board.
Engineer Carmel Sant said that he had known Mr Mizzi for a long time because they had worked together as Enemalta employees. He said that as a tenderer, Mr Mizzi was never treated differently from others. He had exchanged some three e-mails with Mr Mizzi as BWSC’s representative on emission levels. These levels had been set by Enemalta. The information exchanged was always based on theoretical assumptions and there was no agreement with BWSC’s views. He gave his advice on a technical level and was not involved in any legal aspects of the matter.
Mechanical engineer Joseph Mifsud in his evidence said that the part of the tender document dealing with emission levels were not written by him but by two engineers who were his superiors.
The hearing continues today.