The European Investment Bank turned down a government request to finance the consortium building the new gas power plant, The Sunday Times of Malta reports today. However the Energy Ministry said later that the bank showed strong interest and the project 'never encountered problems' with the EIB.
Confidential Enemalta reports show that discussions between Enemalta and the EIB were held during the bidding process in 2013 “with a view to provide bidders with an option to various financing facilities that may be available”.
However, the reports reveal that following a due diligence exercise on the project by the EIB, no funding was approved for the project.
A spokesman for the EIB declined to comment on negotiations with Malta over the new gas power plant, saying only that “the plant is privately financed and Enemalta and the EIB are not talking on the project”.
Energy Minister Konrad Mizzi did not reply to questions sent to him by this newspaper.
However in a reply this morning after the story was published, his ministry said Enemalta and the government conducted preliminary engagement with the European Investment Bank during the early stages of the project.
"At the time the EIB a demonstrated a very strong interest in the project. The engagement was not pursued followed a decision taken to pursue private finance by the Maltese Government. The EIB had in fact continued to demonstrate interest," it said.
"The project never encountered problems with the EIB during due diligence or was refused funding.
"Moreover the project was subjected to rigorous due diligence by KFW, HSBC, Societe Generale and Bank of Valletta, which resulted in a well structured project which will deliver significant benefits."
In a statement, Shadow Minister Marthese Portelli said the Prime Minister and Dr Mizzi had once again been caught hiding information about the project after failing to complete the power station by last March.
It was now clear that no banks wanted to loan their money for this project so the government had to make good for it.
Dr Portelli said the Nationalist Party was again insisting with the government it should publish all documents and correspondence related to the concession and unique bank guarantee.
The Labour Party said the PN's statement showed the party's desperation.