Enemalta had no option but to accept four consignments of high-sulphur fuel oil because its limited stocks gave it little leeway to reject shipments, the Public Accounts Committee heard yesterday.

According to Enemalta’s executive head of generation, Peter Grima, Enemalta’s low stocks would have meant resorting to shutting down its energy generation plants.

He said Trafigura, which has since been blacklisted by Enemalta over corruption allegations, blamed the off-spec deliveries on the shortage of such fuel oil because of the tsunami in Japan and the uprising in Libya.

“Contractually, it is not acceptable that a consignment is off spec but Enemalta’s storage is so small that it had no option as we would have ended up in the dark until another consignment arrived,” he said when asked whether Enemalta was at the mercy of the supplier.

Mr Grima, an engineer, explained that according to directives, Malta has to have a 90-day stock but not necessarily on the island and the small stock levels gave it very little leeway.

He was testifying before the Public Accounts Committee, which is discussing a report by the National Audit Office on shortcomings in the procurement of fuel by Enemalta.

The net damage was zero

He said the fact that Trafigura supplied four consignments with more sulphur had no impact on Enemalta’s or Malta’s targets on emissions.

There were times when the consignment of fuel would have been less than 0.7 per cent sulphur and others when the sulphur content was higher.

However, over a whole year, the average sulphur content of fuel supplied was 0.7 per cent.

“The net damage to Enemalta was zero,” he said as he explained that Enemalta never paid extra for the fuel oil with a lower sulphur content, which was more expensive.

Mr Grima insisted he was not involved in the computation of the $250,000 fine imposed on Trafigura for breaches of contract but stressed that the subsequent consignments were under 0.7 per cent.

Another witness heard yesterday was Enemalta’s former chief commercial officer, Alan Micallef, who said it was Enemalta’s policy to accept bids that were submitted late.

He said this was advantageous to Enemalta as it gave the Fuel Procurement Committee a wider choice.

The PAC has now reached the halfway mark in questioning witnesses, with 33 remaining to be heard.