The man at the centre of the oil procurement scandal said yesterday he was threatened by former Enemalta chairman Tancred Tabone to either pay kickbacks or lose business.

“I had no option,” George Farrugia said in court, arguing that he was forced to give in to Mr Tabone’s “blackmail” or else lose big oil procurement contracts.

Mr Farrugia was testifying in the case against Frank Sammut, CEO of Mediterranean Offshore Bunkering Company (MOBC) before being appointed to Enemalta’s oil procurement committee as adviser to Mr Tabone in 2004. He is pleading not guilty to fraud, bribery and money laundering.

Mr Farrugia was given a presidential pardon earlier this year to reveal everything he knew about the scandal.

He said he was the CEO of a company called Powerplan and acted as an agent for oil giant Total, which wanted to expand its business and would pay him a fee for his services. He said he tried to “infiltrate” MOBC many times but it proved to be very difficult.

He found many closed doors but, one day, he was invited by Mr Sammut to go for a drive around Marsa. It was during that drive that Mr Sammut said he could award the tenders to Total but he wanted half of what Mr Farrugia received from them.

Mr Farrugia said he could not decide on his own because Powerplan was also owned by his five brothers. He later informed them of Mr Sammut’s request, they agreed to his request and the deal went ahead.

“I’m not saying what I did was right or wrong but I had no other option,” Mr Farrugia said before adding: “I did not pay to get paid but so that I could work.”

Mr Farrugia said he also worked for another firm, Trafigura, which wanted to expand its business in Malta and store, blend and re-export oil products from the island.

Mr Sammut had wanted to speak to someone from the company and a representative trader, Tim Waters, came to meet Mr Sammut at the MOBC offices.

Mr Sammut had asked to speak to Mr Waters alone in another room and returned after some 20 minutes, but Mr Waters kept rather quiet and remained so as Mr Farrugia drove him back to his hotel.

Later that same day, over dinner at Buffalo Bill restaurant in Portomaso, Mr Waters told him he was “disgusted” with what Mr Sammut had told him and said that Trafigura did not operate like that.

Mr Farrugia did not elaborate about what Mr Waters said.

Mr Sammut demanded a commission of €1.16 on every metric ton of oil ordered and Trafigura won the tender as it had the cheapest bid and also had oil stored on the island, Mr Farrugia testified.

After Mr Sammut sent the invoice for the commission on the sale, Mr Farrugia received a call from Trafigura saying this would be the first and last time that they were supplying oil because they did not want to get involved in such things.

Trafigura was worried about the consequences of such a deal, especially if the media got wind of it, he said.

Mr Farrugia said he informed Mr Sammut, who replied that he would have to inform Mr Tabone.

The witness said that at that point he was still unaware that Mr Sammut and Mr Tabone were splitting the commission.

The majority of the payments were in cash but, once, Mr Sammut asked for a car, a SsangYong Korando, a brand imported by Mr Farrugia’s brothers.

Mr Farrugia said that he was later told by Mr Tabone that he had to either pay up or lose tenders. Mr Farrugia said he replied he could not keep on giving them money at the rates they expected because what he received would depend on how well the market was doing.

Mr Tabone replied that was his problem adding that if he was not interested another company would get the tender.

Mr Farrugia also spoke of the effect the media pressure had on him. He now appreciated why people would commit suicide.

He said he was not the monster he was made out to be and insisted that oil prices were never altered so he could get paid, as was previously alleged.

In separate proceedings against Alfred Mallia, a former head of Enemalta’s petroleum division, who is also charged over the taking of commissions, former Police Commissioner John Rizzo said he was “under the impression” that Mr Mallia had admitted to being involved.

He said he could not remember all the details because, at the time of the investigation, he had “a thousand other things” to deal with besides the general election.

However, he was under the impression that Mr Mallia had made an admission.

Mr Rizzo said he had given orders to investigate the corruption scandal as soon as the story was broken by Malta Today.