The multimillion-euro energy deal between the Government and Electrogas depended on Labour’s victory at the polls last March, according to Gasol’s CEO.
Gasol, which says it wants to be the leading supplier of gas for power generation and industrial applications in West Africa, is leading the consortium chosen by Enemalta for the construction of a new gas-fired power station in Malta.
Electrogas will be investing about €370 million in the project.
In an interview with the London-based International Oil Daily, Alex Buxton said: “The success of the project relied on the recent landslide victory of the Labour Party, which came to power in March.”
He said the government “fast-tracked the project in a first step to achieve its goal” of reducing energy tariffs by 20 per cent.
Electrogas was expected to be able to conclude the deal by March and to start delivering gas and energy to Enemalta by September 2015, he said.
That would be about six months after the target date Labour set before the election.
“By September 2015, delivery of the first LNG shipment is expected and the consortium should start seeing returns on its investment,” Mr Buxton said.
Government fast-tracked the project in a first step to achieve its goal
Asked to explain what he meant by his declaration that the project relied on Labour’s victory and to state whether Gasol, through its Maltese representatives, had already discussed the details of the project with the party before the election, Mr Buxton said: “It is not appropriate to reply at this stage in the process.”
He said he would reply once the process was concluded.
A series of questions sent by Times of Malta to Gasol in London, asking the company for more details on its connections with Labour before the election, remained unanswered.
Labour has always denied striking a deal before the election.
Electrogas consortium, which was named as the preferred bidder by the government in October, six months after the issue of an expression of interest, is made up of Azeri State company Socar, German engineering giant Siemens and a trio of Maltese businesses, apart from Gasol.
According to the International Oil Daily, Gasol – “a tiny-listed company” – is the lead in the project and already has a strategic alliance agreement with Socar through its trading subsidiary for a proposed LNG import terminal in Benin, Africa.
GEM Holdings, the Maltese arm in the consortium, which holds a 30 per cent stake, is made up of the Tumas and Gasan groups with a medicines-import company, CP Holdings Ltd, owned by Paul Apap Bologna.
Mr Apap Bologna, unknown in the energy sector, now sits on the board of the new company with Yorgen Fenech from the Tumas Group and Mark Gasan of the Gasan Group.
Both the Tumas and Gasan groups had been involved in similar energy-related projects in the past. In the most recent tender – the extension of the Delimara power plant, awarded to BWSC – the Gasan Group, through MAN Diesel, placed second and Tumas Group’s Bateman came third.
According to the government, the supply of LNG will be provided by Socar; however, International Oil Daily reported that although “a major crude oil producer and exporter, Socar has no LNG capability, having neither equity nor portfolio capacity.
“Securing the super-chilled gas in an increasingly illiquid market could come at a premium,” the daily said. According to the government, LNG is to be stored on a permanent vessel berthed at Delimara for 18 years, also provided through a “long-term charter” by Socar, while a regasification plant will be based onshore.
Electrogas placed first in the two-phase bidding process, with US-based Endeavour Energy ranked second.