The government is expected to “imminently” announce the preferred bidder for Marsa Shipbuilding.

Sources said there was really only one obvious preferred bidder out of the six but it did not appear that the operation justified occupying the entire 175,000 square metres.

Let us not overlook that Damen is the ‘Rolls Royce’ in this field. It would be a great asset to have in Malta

Last March, 28 consortia expressed interest in the site but only six went on to submit bids. Only one of them – by Ablecare Oilfield Services Group – was for the entire site, proposing to use it for the oil and gas industry.

The sources said once the preferred bidder was announced, negotiations would encompass not just the footprint it would take over but also the terms of the emphyteusis. “Anything less than 40 years would mean the investment would not be recouped,” they said.

Leaving part of the Marsa site free would open it up for other uses but it would also require the issue of a completely new tender.

“Once we conclude the agreement on the basis of the current request for proposals (RFP), we can issue a new RFP for the part that will not be used as we are bound to do under public procurement rules,” the sources said.

The Sunday Times of Malta reported that Economy Minister Chris Cardona was in contact with Damen NV that has been eying Malta after its attempts to work in Montenegro did not work out.

Marsa Shipbuilding is the obvious candidate for the sort of operations they would like to conduct in Malta but the sources said there could be other options, albeit more difficult ones.

However, no formal talks can take place as the site is technically not available until the current RFP is concluded. In fact, when contacted, both Damen and the ministry said there were no talks under way over Marsa Shipbuilding at present.

The Sunday Times of Malta report that possibly only part of the site would be allocated to the preferred bidder has caused ripples on various fronts, particularly on the impact it would have on the present tender and the bids submitted.

A lawyer well versed in European law said a tender was only a proposal and its terms could be changed at any point until a contract was signed.

If substantial changes were to be made to the concession being offered, a new tender would be issued

“However, the whole point of a tender is for there to be transparency and to ensure there is a level playing field with no discrimination. So you would expect that if substantial changes were to be made to the concession being offered, a new tender would be issued,” the lawyer said, speaking on condition of anonymity.

There were also reactions from the operational side, with sources familiar with the site saying that if part of it were left out of the agreement it could have a negative impact on the business model of the eventual concessionaire.

“Without knowing what activity it would be used for, it is hard to know how much space they would need. But, in theory, the dock could be used for shipbuilding and the preferred bidder could share the shed space. They could coexist...

“If the winning bidder was involved in oil and gas, then shipbuilding and ship repair would also be a way to ensure diversification for the Maltese economy rather than putting all our eggs in one basket for such a long period. And let us not overlook that Damen is the ‘Rolls Royce’ in this field. It would be a great asset to have in Malta.

“However, you would have to analyse the preferred bidder’s business model to see whether the hinterland and shed had a significant role in providing it with recurrent revenue from ongoing oil and gas contracts.”

Although some of the bidders contacted declined to comment as they were bound by confidentiality, sources familiar with similar tender bidding processes said they were concerned because it was unacceptable to change the goalposts at this stage.

“The site has been left more or less abandoned for years and there was real hope it would finally be turned into an economic asset. I fear that any attempts to change the game at this stage could result in objections that would delay the whole process,” one source said.