(Adds government statement)

The Opposition has formally called for a full blown investigation by the National Audit Office over contracts signed by the government on the new power station.

Public Accounts Committee chairman Tonio Fenech told a news conference the Opposition's decision followed the sudden departure of the lead contractor in the new power station, Gasol, with its shares being bought by Electrogas Malta Ltd.

Mr Fenech said that apart from the contract and the methods used to select the winning bid, the NAO was also requested to investigate the unique €88 million government guarantee to cover a loan given to the consortium.

Nationalist Party deputy leader Mario de Marco said that the latest developments showed that the consortium was unable to raise the necessary finance and had to rely on a government guarantee.

So far, none of the agreements signed by the government has been published despite various promises by the Prime Minister to the contrary.

MEETING WITH NAO ALREADY SET UP - GOVERNMENT

In a statement later, the government said that on Tuesday it sent a letter to the NAO about the matter to clarify facts. A meeting had already been set up.

The government said it welcomed all scrutiny on the matter and reiterated that due process was followed. Moreover the increase in shareholding by two global giants was testament to confidence in the project which was progressing to plan.

The recent consolidation, it said, would have no impact on project timelines, construction and provision of power and gas to Malta and the Maltese people.

ElectroGas, through Siemens, Socar and GEM holdings, had strong financial backing and would deliver a world class infrastructure which would continue to contribute to the country's competitiveness and reduce emissions significantly.