Streamcast data centre: ‘dead project’ costs Enemalta €400,000

An Indian-owned video streaming business whose principals closed shop before paying their dues, has been ordered to pay Enemalta €400,000 in contractual dues.

But the money is expected go down as a bad debt for the state utility company, as well as being a botched project for a data centre that never materialised after the company disappeared from Malta.

Originally the cloud operator was slated in 2017 to be part of a €75 million secure data centre inside Enemalta’s extensive underground infrastructure – a project which failed to materialise.

But The Shift later revealed that Nimish Pandya’s Streamcast had been built around a network of shell companies, and that the company used its Maltese connections and ventures to hike up its value before being sold for €2 million in 2019. A related Irish company, Streamcast Technologies Holdings, held a shareholding interest from Nexia BT partners Brian Tonna, Karl Cini and Manuel Castagna – auditors in the Panama scandal that implicated former energy minister Konrad Mizzi and one-time chief of staff Keith Schembri.

A Maltese court on Friday said Streamcast had to pay over €422,000 to Enemalta for leasing space at the Marsa power station for its data centre. The server farm project never materialised and in February 2020 Enemalta filed a claim for €157,551 in contractual dues, €219,480 for use of infrastructure and €34,230 for energy bills. The sum included eight tranches of €22,507 in ground rent and a private agreement for the rental of two fibre optic cables from the Sicily interconnector.

Enemalta CEO Jason Vella told the court that in November 2019, Enemalta found technical damage during a site inspection and contacted Streamcast to remedy the situation as there was a fire risk. Streamcast said it had nobody who could fix the damage and so the electricity supply to the data centre was suspended. “There was no subsequent effort by Streamcast to reconnect the electricity supply to use the data centre and the project is now dead,” Vella said.

Streamcast did not reply to any of the accusations in court, never sending a legal representative to court.

The court said the evidence provided by Enemalta led it to be morally convinced that the defendants had abandoned the site and therefore breached the contract, apart from not paying rent. The court upheld the claim by Enemalta for Streamcast to pay the amounts due, with legal interest.

But it is unlikely that Streamcast will be paying Enemalta its dues. Streamcast has also been condemned to pay €300,000 to Melita for internet connection fees dating back to the date of its incorporation. Another private company, P&C Limited, filed a judicial letter in March demanding the enforcement of a promise of sale on an office block in Marsa for €7.2 million.

Enemalta had denied any suggestion of wrongdoing in the Streamcast project, saying it had not invested any money in the project and that the data centre costs were the responsibility of Streamcast Technologies. Enemalta’s role was limited to the lease of its property.

On its part, Nexia BT and its Capital Knight shareholders had denied receiving any funds from the sale of Streamcast in Ireland. Capital Knight, which owned 400,000 shares in Streamcast’s Irish holding, was dissolved in December 2018 soon after the dissolution of Streamcast Technologies Holdings.

Nexia had declared that the Irish holding company had no shares in the Malta-based Streamcast Group or participation in the Maltese project – however, energy minister Joe Mizzi had declared in parliament that Enemalta had signed its memorandum of understanding in November 2017 with another related company Streamcast Technologies Inc [Delaware] for its local subsidiary, Streamcast Limited.

The Nationalist Party had described the company as a scam and in February called on Prime Minister Robert Abela to provide the public with a detailed explanation of the project.