Enemalta’s former chief commercial officer, Alan Micallef, yesterday said he repeatedly warned the corporation in writing that four Trafigura shipments of fuel oil that were not within the sulphur content specifications constituted breaches of contract.

Testifying before Parliament’s Public Accounts Committee, he said if it were up to him he would have terminated the contract.

The fact that, in spite of the lengthy internal correspondence, Trafigura agent George Farrugia had wanted to meet Enemalta officials face to face to discuss the shortcomings showed the gravity of the situation.

With hindsight Mr Micallef agreed that someone at Enemalta had been dragging their feet for a whole year despite his warnings, and finally Trafigura had been fined $250,000. Rather than fining the company, the shipments in principle should not have been accepted, but that would have had to depend on stocks of fuel oil in hand, he said.

Mr Micallef said he had started working with Enemalta in 2009 with a brief to instil new procedures on fuel procurement and had immediately started to introduce changes. He had left the corporation in July 2012 after being given a completely different job following a top management restructuring.

He said the sulphur content had been the most important aspect of each shipment.

I would have terminated deal

Architect David Xuereb, who flew in from his practice in London to appear before the PAC, said he had been appointed to the Enemalta board of directors in March 2011, served as deputy chairman until November 2011 and resigned in July 2012. His brief had been to support transparency, and there was enough going on to motivate change. This had been mentioned in the first draft of the Fuel Procurement Policy.

The board had never discussed delivery of shipments and technical management, but the chairman and financial officer used to update on events. An incident in January 2011, before he joined the board, had accelerated the need for change in the tendering process.

The Fuel Procurement Committee had two main responsibilities: one to procure fuel for vehicles and the other to procure fuel for the power station.

Fuel procurement decisions had always been taken on a single laptop in the chairman’s office, but it was not his own laptop because the chairman was a part-timer. Mr Xuereb said he had never sat next to the chairman in these sessions.

In his recollection, the chairman had always phoned MITA for a password. He only used to inform the committee of the number of bids, without identifying the bidders. When two bids were very close, the chairman used to negotiate with the bidders by telephone, sticking to committee guidelines.

Mr Xuereb said he had been surprised at the Auditor-General’s comment that there was no record of phone calls to MITA during meetings.