Electrogas termination would cost government €417 million - Auditor General

Terminating the Electrogas power station deal would cost Maltese government at least €417 million due to liability clauses stipulated in the contract, parliament's Public Accounts Committee heard today. 

Auditor General Charles Deguara told the PAC that the contract includes four liability clauses which would come into force if there contract were to be terminated.

He said that in the case of a default by Enemalta, government would have to pay all outstanding amounts owed to lenders and banks. This currently stands at €417,186,000.

The committee heard a testimony from David Galea, a former chairman at Mount Carmel Hospital. He was hand-picked for a consultancy role at Enemalta, and was a project manager for the LNG plant site, overseeing preparation, negotiations, and contracts. 

Galea said that he was answerable to the LNG plant project's sponsoring committee and to the Enemalta board of directors. He confirmed that he was a friend of former minister Konrad Mizzi and that, between 2013 and 2019, he had been awarded over €1 million in consultancies through direct orders. 

He further acknowledged that, in the run-up to the 2013 election, the Labour Party had paid him a consultancy fee prior to the drawing up of the electoral manifesto.

Galea verified that, among the direct orders given to him was a €43,000 consultancy for Air Malta and a further €8,000 for a management report for Enemalta on the Auditor General's report on Electrogas.

He confirmed that Konrad Mizzi, albeit not a member of the selection committee, would attend meetings as an observer.

PN members within the committee requested that Joseph Muscat, Konrad Mizzi, Keith Schembri and Yorgen Fenech appear before the PAC as witnesses.