Malta’s fuel purchases minuted in scribbles since 2004

Seven years of decisions that determined the purchase of millions in fuel for Enemalta went by without ever being properly minuted, documents obtained by this newspaper show.

Enemalta's fuel procurement committee, the body that decided from whom Enemalta purchased its fuel, never formally kept minutes of its decisions. Instead a collection of scribbled notes were kept until action was taken in 2011.

The evidence suggests that the poor record keeping may have obscured decisions that favoured particular oil suppliers to Enemalta.

The last FPC meeting minutes that were kept according to appropriate record-keeping methods dated to 18 December 2003.

The minutes only resumed a formal nature when responsibility for the energy sector was passed from Austin Gatt to Finance Minister Tonio Fenech in 2011.

The properly kept minutes from December 2003 comprise six pages and include the names of committee members, agenda items and fuel bids received, and they also explain the procurement committee's reasoning in selecting, in this case, an offer by Dutch commodities firm Trafigura.

The same company has been implicated in the alleged payment of kickbacks to then-Enemalta chairman Tancred Tabone and his consultant Frank Sammut - who occupied the post of chief of Enemalta's bunkering arm, the Mediterranean Bunkering Oil Corporation (MOBC) - for the supply of oil to Enemalta.

Informed sources told MaltaToday that the only minutes found for meetings after 2003 are mostly handwritten, incomprehensible notes. Although some may include the date or committee members, the majority cannot be matched to an FPC meeting.

Last week, Parliamentary Secretary for Justice Owen Bonnici told a parliamentary accounts committee hearing on the National Audit Office's audit of fuel procurement policy that minutes "started deteriorating when corruption of the award of oil contracts started creeping in".

Bonnici said the poor minute taking took place during the same period as Trafigura was awarded its first contract in 2004, even though it was not among the 16 bidders for the tender.

So far, the Auditor General's audit of fuel procurement has concentrated on decisions taken between 2008 and mid-2011, for which he flagged the abysmal level of record keeping and documentation adopted by the FPC. The minutes reviewed by NAO "lacked the most rudimentary level of detail and bore no information relating to meeting discussions and decisions taken", the NAO said in its audit.

The situation was so serious that the NAO said it couldn't understand how decisions worth hundreds of million of euros could have been subject to this abysmal level of record keeping and documentation, "in blatant violation of the principles of management, good governance, accountability and transparency".

Following the publication of the NAO report, Enemalta's former chief financial officer Pippo Pandolfino claimed that the scribbled minutes were his "own working notes". Pandolfino attended all committee meetings between 2004 and 2009.

MaltaToday's revelations of kickbacks paid in 2004 and the involvement of oil trader George Farrugia - an agent for Trafigura and TOTSA who was eventually granted a presidential pardon to turn state witness - led to various charges of bribery and corruption against former Enemalta chairman Tancred Tabone, former chief of MOBC Frank Sammut, businessmen Anthony Cassar and Francis Portelli, and three former Enemalta officials, Tarcisio Mifsud, Ray Ferris and Alfred Mallia.