REVEALED | Kickbacks paid for Enemalta oil purchases to procurement official

Documents and invoices seen by MaltaToday show that commissions were paid to an Enemalta procurement committee member for the oil purchased by the state utility, into a Swiss bank account traceable to Frank Sammut.

MaltaToday can confirm that Trafigura, a Dutch commodities company which sold fuel oil to Enemalta, deposited regular amounts into a Swiss Bank account, whose beneficiary company - Energy & Environment Consultants Ltd of Gibraltar - belonged to Frank Sammut.

The documents show that Trafigura deposited payments to the nominee company, while also making specific reference to the Enemalta contract number for the purchase of oil, and referring to the commission paid as a 'consultancy fee'.

Sammut was a member of the oil procurement committee set up by Investments Minister Austin Gatt, under whose remit Enemalta fell. Every year, Enemalta purchases around €360 million of oil or around €1 million a day.

Sammut was previously also chief executive officer of the government-owned Mediterranean Offshore Bunkering Company.

MaltaToday now has in hand conclusive and irrefutable evidence that commissions were paid to Frank Sammut's Swiss bank account when he was appointed on this powerful committee to buy oil for Enemalta, when he also served as CEO at the MOBC.

Enemalta's main supplier of low sulphur oil, TrafiguraBeheer BV, based in Lucerne, Switzerland, paid commissions - described as 'consultancy fees' - in an HSBC bank account in Lugano belonging to Energy & Environment Consultants Ltd.

Documents in MaltaToday's hands shows that on various occasions, Trafigura paid commissions "on contract of sale of low sulphur fuel oil to Enemalta" with an invoice number that matches that of the relative Enemalta fuel purchase.

As an example, on 6 February 2004, Trafigura invoiced Enemalta for the amount of US$4.4 million for 26,000 metric tonnes of low sulphur fuel oil, delivered to Malta by the Zoja 1 tanker.

Another document shows that on 25 March 2004, Trafigura was invoiced for US$19,402 by Energy & Environment Consultants - registered at 28, Irish Town, Gibraltar and holding an HSBC account at Piazza Manzoni in Lugano.

The invoice to Frank Sammut refers to the contract number issued by Trafigura for the sale of the Enemalta oil.

While also serving as MOBC chief executive, Sammut appears as the beneficiary of the consultancy firm. Around US$300,000 dollars a year were deposited by Trafigura as consultancy fees on contract of supply of fuel to Enemalta.

Sammut's name is not new: MaltaToday is aware a very senior Nationalist politician was informed that the government appointee could not be trusted, and yet nothing was ever done. Even documentation concerning Sammut's dealings had been reported by a well-known Birkirkara entrepreneur involved in oil importation to the government.

Experts in the field at the time also made it known that the new purchasing system could lead to some very serious abuse.

And a hint of something truly unorthodox first appeared last week in a letter to The Times by a former senior manger at Enemalta, John Pace, who claimed that Gatt's administrative changes at Enemalta included a change in the way fuel was being procured.

"In 2003, Josef Bonnici lost his seat and Austin Gatt became the minister responsible for Enemalta. He immediately made administrative changes at Enemalta, including a change in how fuel was procured. This resulted in the formation of a powerful lobby by the fuel importers who would stand to lose millions of euros if the power station converted to gas. This lobby may have influenced the decision but I think the real reason lay elsewhere."

Even a former Nationalist candidate for the European Parliament, Frank Portelli - the director of St Philip's Hospital - in August 2009 claimed he would be willing to reveal Enemalta officials he believed were on the take, only if whistleblowers' legislation were in force.

Enemalta's oil purchases persisted even after in 2006, the government cabinet approved an electricity generation plan for 2006-2015 that said the Delimara power station should be converted to gasoil. But in 2008, this policy was ignored to allow heavy fuel oil to fire a new Delimara power station extension supplied by Danish firm BWSC.

Several attempts to contact Frank Sammut by phone at his Marsaxlokk residence for a comment yesterday evening proved futile.

Who are Trafigura?

Trafigura has been featured in previous allegations of malpractice since its creation in 1993 when a group of entrepreneurs split away from the group led by controversial US businessman Marc Rich. These include being the first company contracted to sell oil produced in Sudan in 1999, a year after the US bombed Khartoum and had declared the country a state sponsor of terrorism, barring all US companies from doing business with the regime.

Trafigura was also named in the Iraq Oil-for-Food Scandal, and convicted in Amsterdam in 2010 for illegally dumping toxic waste in Ivory Coast and fined €1 million. A September 2009 UN report says up to 108,000 people sought hospital treatment because of this. In the same year, Trafigura tried to prevent reporting of a question in the UK parliament of the Ivory Coast affair in The Guardian newspaper by using a "super-injunction" gagging order, and brought a libel suit against the BBC's Newsnight programme for their reporting on the story.

In February of last year, the public prosecutor in the Netherlands opened an inquiry into allegations Trafigura paid bribes to a leading politician in Jamaica. Trafigura is the world's third-largest oil and metals trader after Vitol and Glencore. Although based in Amsterdam, the company has an opaque offshore network using many subsidiaries and shell companies in its international dealings. The fiscal address is in Amsterdam, the operational centre is in London, while the headquarters are in Lucerne, Switzerland. Trafigura's main shareholders are Jersey, Dutch Antilles and Maltese-based companies.