PM asks police to probe oil graft claim

Prime Minister Lawrence Gonzi has asked the Police Commissioner to investigate an alle­gation that kickbacks were paid for Enemalta oil purchases nine years ago.

The decision was taken after a newspaper yesterday published documents claiming to show that a member of Enemalta’s oil procurement board had sought commissions from a company that supplied oil for the power stations.

A spokesman for the Prime Minister said Dr Gonzi asked the Police Commissioner to investigate the allegation and take all the necessary steps “in the shortest time possible”.

Reacting to the news, Labour leader Joseph Muscat said he was “shocked but not surprised” by the revelation.

Addressing party supporters at a meeting in Rabat (see page 5), Dr Muscat said the allegation “helped explain” institutional resistance to switching to gas-powered energy generation. He also challenged Dr Gonzi to say whether he or his advisers had at any point gotten wind of corruption allegations.

The case dates back to 2004, soon after an oil procurement board was set up by then Enemalta Minister Austin Gatt.

Dr Gatt yesterday insisted he was never warned that any member of the oil procurement board was taking kickbacks or engaging in corruption.

“Nobody ever came to me to say there is a suspicion that somebody could be pocketing some money in the procurement board of Enemalta. Absolutely no one came to tell me that about anyone,” Dr Gatt said when contacted.

MaltaToday claimed that Frank Sammut, who sat on the oil purchasing committee, received thousands of dollars from Dutch oil firm Trafigura that supplied Enemalta with its fuel oil requirements.

The paper printed an invoice belonging to a Gibraltar-based company, owned by Mr Sammut, showing that Trafigura was charged more than $19,000 in the form of a “consultancy fee” over a contract of sale for the supply of oil to Enemalta.

The money was allegedly to be paid into a Swiss HSBC bank account that belonged to Mr Sammut’s nominee company.

Mr Sammut served on the procurement committee until 2005 but for many years was also chairman of Mediterranean Offshore Bunkering Company, a state-owned firm.

The story came hot on the heels of an opinion piece in The Times last Friday by a former Enemalta manager, who alleged that a decision to ditch a proposed gas pipeline was influenced by “a powerful lobby” of fuel oil importers.

Engineer John Pace, a former manager at Enemalta responsible for electricity generation and EU affairs, wrote that Dr Gatt had introduced a number of changes when taking over Enemalta, including the way fuel was bought.

However, Dr Gatt yesterday reiterated there was “no relation between the so-called oil lobby” and the Government’s decision not to opt for a gas pipeline in 2003.

Dr Gatt said he could not vouch for Mr Sammut. “I can’t vouch for anyone.”

He said that when he became minister nine years ago the oil procurement committee was “strengthened” from a small internal board to a larger 10-man board, which included Mr Sammut and representatives of the Finance Ministry, the oil division, the Central Bank and Enemalta.

“We nominated a large board of 10 people from different fields where decisions were taken together, not one or two persons deciding alone,” Dr Gatt said.

He insisted that his job was to appoint these people in conjunction with Enemalta’s board of directors.

“But if one of them turns out to have been corrupt that is for the police to establish and investigate. I never got involved in the procurement procedure,” Dr Gatt said.

Meanwhile, Finance Minister Tonio Fenech distanced himself from the 2003 happenings, pointing out that he was not even involved in politics at the time.

Mr Fenech, who is now responsible for Enemalta, agreed with the Prime Minister’s decision to call an investigation into the allegations.

He said that when taking over Enemalta two years ago the corporation’s oil procurement procedures were reviewed to make sure they were “tight”. The review took place in 2011.

Asked if this review was carried out because of suspected corruption, Mr Fenech said: “No, but obviously good governance dictates that you review your procedures rather than introduce them and leave them there.”

Attempts to contact Mr Sammut by phone yesterday proved futile and nobody answered when The Times knocked at his house.

Additional reporting Kurt Sansone.