In early summer, Enemalta Corporation issued full-page advertisements in local newspapers for the sale of premises and land of the ex-Sea Malta Company. The sale, despite the publicity given to it, has gone practically unnoticed, both politically and by local opinion makers.

This silence is disconcerting as this sale raises critical questions on the financial sustainability of Enemalta Corporation. It is pertinent to remind readers that the Prime Minister, days before the General Election, when questioned directly by Peppi Azzopardi on TV about the financial sustainability of Enemalta Corporation, had replied that there was no cause for concern.

So why does Enemalta hold possession of the ex-Sea Malta land and property? How did it come by it? Why is land – the only single tangible asset that the government holds in trust for the people – in this prime site being sold? Is this mere speculation, or is it something worse?

Tracing the Enemalta Corporation Accounts is no easy matter because the Corporation’s website only provides audited accounts up to 2005, signed by PriceWaterhouseCoopers. However hard one tries, the audited accounts for 2006/7 cannot be accessed, even though the law states that the Corporation must present these on an annual basis.

It may be pertinent to ask the auditors whether they did anything about this infringement. Did they accept it? Didn’t they feel that they had to escalate this public and financial infringement by a State entity?

The last published Accounts show that Lm53.5m in land, buildings and improvements were added to the Enemalta Corporation. In note 8 to the Accounts, the auditors remark that “during the year, the government transferred to the Corporation, by title of temporary leasehold, land and property which the Corporation has been occupying since its incorporation, including petroleum storage facilities at Has-Saptan and Kordin, together with land at Benghajsa which is intended for the relocation of the existing gas bottling plant. The costs of these assets, determined by the Corporation on the basis of their estimated fair value for commercial use, amounts to Lm53.5 million. The property transfers have been reflected as an addition also to the capital contribution by government…”

On the surface, the injection of capital by means of land and title allocation by the government into Enemalta Corporation looks harmless enough. Yet the sale of the ex-Sea Malta land and building, gives this transaction a sinister twist. The following questions arise:

• Was the Sea Malta land and building part of this transaction?

• What value did the government attribute to this land and property?

• What is the value given to this property in Enemalta Corporation’s balance sheet?

If both Enemalta and the government are to be transparent, these key questions need answering. The 2005 Audited Accounts make it clear that such transactions were carried out to enable Enemalta Corporation to privatise both its Gas Division and its Petroleum Division to an Italian-Maltese consortium. Presumably, the Benghajsa land referred to in the Audited Accounts forms part of this privatisation process. Or does it? If so, what is the transaction value of this land in the privatisation package? What value was subscribed to this land in the Corporation’s balance sheet?

The absence of the 2006/7 Audited Accounts make it difficult to truly understand how this capital injection has strengthened the Corporation’s balance sheet. Justifiably therefore, one is entitled to ask whether this transaction was in lieu of payments owed to the government for absorbing the subsidisation of oil prices. If so, what was the economic rationale for this transaction? What constitutes this debt? Is this why the Sea Malta land and property is now being sold?

The accounts till 2005 show that Enemalta’s debt, while restructured, has increased from Lm115m in 2002 to Lm119m in 2005. Why is Enemalta’s debt not decreasing? What constitutes this debt? To what extent has Enemalta paid the Delimara Power Station investment?

And if, as one is given to suspect, the land transaction goes beyond that stated in the 2005 Accounts, and represents a trade-off for Enemalta vis-à-vis absorption of the subsidy given to consumers, to what extent was this a sound business decision as against one of political convenience – presumably directed to fiddle the national GDP Accounts in order to reach the Maastricht Treaty criteria on the national deficit?

How truly financially sound is Enemalta Corporation therefore? We challenge the Prime Minister to table the 2006/7 Accounts together with the management letters of the Auditors, to transparently show the true state of play of the Corporation. We challenge the Prime Minister to respond to the questions we raised with the appropriate detail and figures so that the public becomes aware of how public land is being managed.

If the Prime Minister fails to meet this challenge, he can be assured of one thing. We will relentlessly pursue this matter until the mirrors and shadows surrounding Enemalta Corporation are dismantled. And we shall pursue every avenue to achieve this. The country deserves to know the real reason behind the just announced energy price hikes.

Dr Muscat is party leader of Azzjoni Nazzjonali