Updated | Police asked to investigate post-2008 Enemalta fuel procurement

Adds statement by the Ministry for Energy

Energy Minister Konrad Mizzi has asked the Police Commissioner to investigate fuel procurement carried out by Enemalta after 2008, MaltaToday has learnt.

The investigation follows a damning report by the Auditor General on Enemalta's fuel procurement committee between 2008 and mid-2011. The National Audit Office flagged the lack of a policy framework by which the committee operated between 2008 and 2010.

Energy minister Konrad Mizzi has already declared he would render Enemalta's fuel procurement system more transparent, after the NAO's investigation surmised there was political interference into the way the state utility purchased its fuel.

The new developments raise serious doubts on the veracity of oil trader George Farrugia's account on procurement kickbacks in 2004. Farrugia was given a presidential pardon to turn state witness, on the condition that he just says the truth and nothing but the truth.

Mizzi is now requesting the Police Commissioner to launch the investigation based on the Auditor General's findings.

Contacted by MaltaToday, Konrad Mizzi said the police's investigation into the Enemalta oil scandal did not cover the period mentioned in the report. "The Auditor General has however raised serious doubts about how the procurement was carried out until mid-2011," he said.

Mizzi noted the NAO's findings referred to Enemalta not going for the cheapest bids. "These might raise serious questions and we therefore want the police to investigate it. The Auditor General's report merits closer attention."

One of the points raised by the Auditor General referred to the systems of poor record-keeping and documentation that characterise and pervade the operations of the FPC prior to May 2011 which made it impossible for the NAO to effectively audit the decision-making process employed by the Committee in adjudicated tender bids received and evaluated.

"The implications of such severe limitations in the availability of records documenting the FPC's decision-making process are brought to the fore in those instances when the Committee awarded tenders to bidders who (based on severely limited information at the NAO's disposal) did not submit the most favourable offer," the Auditor General said.

The Energy Ministry has noted the lack of transparency emphasised by the Auditor General in the Enemalta Fuel Procurement up to May 2011, which raise questions as to whether alleged wrong-doings in the process were perpetuated beyond 2008.

"For these reasons, Minister Mizzi referred the matter for the Commissioner's further consideration to determine whether the Enemalta Oil Procurement process, as conducted between 2008 and May 2011, involved conduct which constituted the commission of criminal offences," the ministry said.

Prior to the formulation of a fuel procurement policy in January 2011, Enemalta's fuel procurement function "was effectively operating in a policy vacuum", the NAO said.

The inquiry found poor instances of record-keeping and corresponding fuel procurement meeting minutes lacked "the most rudimentary level of detail and bore no information relating to meeting discussions and decisions taken".

"Besides being handwritten and mostly undecipherable, these minutes also lacked a basic record of Committee members present," the NAO said, adding it found it a problem to effectively audit the decision-making process.

Between 2003 until early 2010, Enemalta fell under the responsibility of then investments minister Austin Gatt.

Enemalta was later passed under the responsibility of finance minister Tonio Fenech in early 2010.

Since the publishing of the report, Gatt has refused to comment telling MaltaToday he was "not interested".  

The NAO report was carried out on the request of then Labour MP Leo Brincat during the preceding Nationalist government.

Upon taking Enemalta, Tonio Fenech said he had immediately commissioned a review of the tendering procedure and a specific policy was drawn up.