The government, which is already in hot water over a €88 million guarantee over Electrogas' bridge loan from Bank of Valletta for the construction of the new Delimara power station, said this evening that Electrogas has secured a new loan of €450 million - 80%, €360 million, of which will be guaranteed by the government.
The remaining 20% of the bridge loan will be guaranteed by Electrogas itself. The original €88 million government guarantee covering the previous Bank of Valletta loan has now been cancelled out.
Finance Minister Edward Scicluna and Energy Minister Konrad Mizzi have confirmed that the new 22-month bridge loan will be funded by four banks: Bank of Valletta, HSBC Bank plc, Société Générale and German bank KFW IPEX-Bank GmbH.
The ministers said that ElectroGas Malta has paid the government a guarantee fee of €8.8 million.
The ministers said that the new agreement had been struck at the end of last month and that the government's State Aid Monitoring Board has cleared the new state guarantee.
The guarantee, according to the government, is an interim measure, as was the previous loan, clearance from the European Commission over the Security of Supply Agreement (SSA) the government had entered into with Electrogas is approved by the European Commission.
Colossal burden to save Muscat’s skin – PN
Reacting to the news, the Opposition said that the Maltese people will now have to bear a “colossal burden” so that Prime Minister Joseph Muscat could “save his skin”.
The Nationalist Party in a statement “strongly condemned the government’s irresponsible decision to provide a colossal guarantee of €360 million for the construction of the power station”.
The PN pledged that it will not allow this “grave act of irresponsibility” to go ahead and that it will hold the government fully accountable for its actions.
“This is a colossal burden that was created surreptitiously, and one which the entire country will have to bear without any form of consultation. After the government behind everyone’s back had introduced the first €88 million burden, that burden has now been increased to €360 million.”
It added that such a move was “unprecedented”.
The Opposition noted that the Prime Minister has already failed his leading electoral promise to build the new power station in two years, and that it is now clear that the government has also failed to have the power station built by the private sector.
The Maltese people, the opposition said, will now have to pay, through their taxes, to make good for a project that the country does not even need. The Opposition added that the government does not have an electoral mandate to burden the country with a €360 million guarantee.
PN media was not invited for press briefing
In a statement, Media.link Communications Head of News Fabian Demicoli said the government was discriminating against certain media houses as the PN’s newsroom was not invited for a press briefing on the subject like the other media houses.
Mr Demicoli said the news announced by the government was very serious and the people had a right to know what was going on. The government, he said, did not want the readers and followers of the media company to know what was happening. The government should represent everyone, and not just a section of society.