The public inquiry into the assassination of journalist Daphne Caruana Galizia continues today and Electrogas shareholders Paul Apap Bologna and Mark Gasan are testifying.
In the previous sitting Superintendent George Cremona, head of the police Counter Terrorism Unit testified that the Maltese police had received a tip-off from their American counterparts in September last year of a weapon purchase on the dark web that was addressed to George Fenech at a Portomaso address.
The public inquiry into the murder of journalist Daphne Caruana Galizia is tasked with, amongst other things, determining whether the State did all it could to prevent the murder from happening. Caruana Galizia was murdered in a car bomb just outside her Bidnija home on 16 October 2017.
Three men, George Degiorgio, Alfred Degiorgio and Vince Muscat, have been charged with carrying out the assassination, while Yorgen Fenech is charged with masterminding the murder.
Melvin Theuma, who acted as a middleman between Fenech and the three, was granted a presidential pardon last year to tell all.
The inquiry is led by retired judge Michael Mallia and includes former chief justice Joseph Said Pullicino and Judge Abigail Lofaro.
Follow proceedings live, below:
12:53 Thank you for following.
12:53 Apap Bologna's testimony is over. The next sitting is on Monday at 2pm.
12:48 Apap Bologna says that he did not meet the director of Siemens in Malta this week, although he is aware that he was in Malta.
12:47 It is pointed out that he had never issued any statements to this effect. "You have my statement now, I'm not connected," he replies.
12:46 Said Pullicino asks how the hype on the prime minister's and Konrad Mizzi's visit to Azerbaijan had effected the witness. "I obviously queried the scope of the visit but I never got an answer. We at Electrogas don't know what the purpose of their visit was. It is nothing to do with Electrogas," he replies.
12:43 Apap Bologna: "Yes, I am sure."
12:43 Azzopardi: "Are you sure?"
12:43 Apap Bologna scoffs: "Absoltuely not."
12:42 Azzopardi: "Is it true that you donated €1 million to the Labour campaign in 2013?"
12:42 Apap Bologna: "No."
12:41 Azzopardi: "Has Yorgen Fenech ever mentioned to you who the owner of Macbridge is?"
12:40 Lofaro: "I cannot warn you enough to be careful in your replies."
12:40 Apap Bologna: "No, he did not."
12:39 Azzopardi: "Did Edward Zammit Lewis set up meetings between yourself and Joseph Muscat?"
12:39 Apap Bologna: "I do not know."
12:39 Azzopardi continues that on 16 October 2013, Caruana Galizia wrote another article on the alleged done deal concerning the power station, reminding her readers that back on 9 January, Konrad Mizzi told the press that the new power station would cost €376 million. Caruana Galizia's blog read: 'That was clearly the actual cost and if they had the actual cost they probably had the supplier to quote it to them. Now we learn through Gasol's investor statement, published as mandated by stock exchange regulations (the London AIM list) that the power station will cost - oh, what a surprise - €370 million.' "How did Konrad Mizzi know the exact figure?"
12:36 Apap Bologna: "I will have to check. Siemens would have been taking care of the issues relating to the power station. There would have been teams and committees dealing with these aspects."
12:35 Azzopardi says that Daphne Caruana Galizia on 15 January 2013 quotes a risk assessment consultant on this topic. 'This proper security risk assessment takes a year and is obligatory before the insurance takes on the risk,' the quote goes. "Was the insurance an afterthought?"
12:33 "To insure the third-party risk for a power plant is a must, a sine qua non," Azzopardi states. The witness agrees.
12:33 Apap Bologna says he was not aware that Yorgen Fenech was in negotiations with government over the bank guarantee.
12:32 Apap Bologna: "They were involved in downstream projects. They were doing a similar project in the Benin region... they were a company focusing on the infrastructure... I only became aware of the financial difficulties of Gasol when they could not go forward in 2015."
12:31 Azzopardi: "How come a lead partner, a few months down the line is found to have financial difficulty. What was the need for Gasol?"
12:30 Apap Bologna: "No. I became aware when I was told that Gasol had financial issues at that point in time."
12:30 Azzopardi: "What sort of due diligence took place? Just a year after, there were financial concerns on the financial standing of Electrogas. This was mid-2014. It became evident that the SSA was to be in effect. Were you aware of the concerns?"
12:28 Apap Bologna: "Gasol. I had one of my school friends from the UK working there."
12:27 Azzopardi: "Who brought in Socar?"
12:27 Apap Bologna: "I don't know. I have no clue."
12:27 Azzopardi: "When was Electrogas told that the storage would be offshore?"
12:26 The witness maintains that when he wasn't a director he was not privy to the discussions at EGM level.
12:25 Apap Bologna: "No."
12:25 Azzopardi says the call for expression of interest took place on 11 April 2013, just a month after the general election. "The audit office maintains that the security of supply agreement changed things dramatically. Were you at any time privy to discussions to clinch this security of supply agreement, which was crucial in reducing risk?"
12:24 Apap Bologna: "We were not privy to this information."
12:23 Azzopardi reads from the NAO report: "The security and supply agreement was first circulated on 5 September 2013. There was not an equal playing field, right?"
12:22 "You're asking me to answer a question on a document produced by Gasol..." the witness begins but is cut off by Azzopardi, who points out that it is costing the taxpayer a large sum of money every day.
12:22 "Payment based on capacity. What does it entail," Azzopardi asks.
12:21 Apap Bologna: "The uptake of electricity and gas."
12:21 Azzopardi asks: "What does government guarantee imply here?"
12:20 Apap Bologna: "I cannot answer that because I didn't put together that presentation (the 2008 presentation). That was a presentation put together by Gasol, who would have been presenting international standards of how a project like this happens."
12:19 Azzopardi: "The 20-year term in the proposal is very similar to the 18 years in the contract signed with Enemalta."
12:18 Apap Bologna: "It was a joint decision between Yorgen Fenech, myself and Gasan."
12:17 Azzopardi asks why the concept paper before the 2013 election said the Maltese consortium of companies was fronted by Paul Apap Bologna but when the pre-electoral manifesto proposed a restructuring of the energy sector, Yorgen Fenech became the lead man. The lawyer says that even on the submission documents, Fenech was the lead.
12:15 The witness is asked about a meeting with Gasan at Level 22 Portomaso. He replies that he was not aware or present for any such meeting.
12:13 Azzopardi asks whether he had "not crossed the bridge" and spoken to the PL after the PN didn't show interest in the gas power project. "That is correct," Apap Bologna says.
12:09 Azzopardi tells him the date of when this happened is not important. "What is important is this: would it have been logical and reasonable for an old salt in the business world to ask why Fenech, a paragon of business acumen, was stepping down at that time. Remember that there will be data coming out of Yorgen Fenech's mobile in a few days."
12:08 Apap Bologna: "We had a board meeting of GEM after Fenech resigned and I offered to step in..."
12:05 Jason Azzopardi asks him how he became a director of Electrogas.
12:05 We're back inside the court hall. The inquiry board reminds the witness that he is under oath. The board is hearing the testimony of Paul Apap Bologna, an Electrogas shareholder.
11:53 Azzopardi asks for a five-minute recess. Mark Gasan will testify on Monday at 2pm since there is no time for him today. The board takes a 10-minute break.
11:52 Comdini Cachia asks about the Bangladesh project, similar to the Electrogas one, which Yorgen Fenech wanted to start. "It was none of my business and I found out about it from the press."
11:51 Lawyer Jason Azzopardi groans.
11:51 Apap Bologna: "The model has been shifted often... I would have to get back to you on that by I estimate 2023."
11:50 Comodini Cachia: "The financial projections indicate that you'll make a profit on which year?"
11:49 Apap Bologna: "We had success fees and development fees of €6.1million. I then reinvested this in Electrogas - expenses for the government guarantee, which amounted to around €3.6 million, bank charges around €400,000..."
11:48 Comodini Cachia: "We're being told that you haven't made a profit. Have you received any money from this project?"
11:45 Apap Bologna: "I knew he was going to make an article but not the contents."
11:45 "Always from the press," notes Lofaro.
11:44 He says the Gasans did not inform him of their position on Electrogas before they went for the public statement in which they announced they wanted out of the project.
11:43 Apap Bologna: "Substantial. In the region of €9 million. It is the shareholding in Electrogas Malta and GEM. This is the money put in through cash, loans and guarantees."
11:41 Comodini Cachia asks what is his financial commitment in this project.
11:40 It is pointed out that there was an email sent by BOV in 2017 brought to Electrogas's attention that the company was in default on the loan facility. "I was not copied in the email. This was being handled by Electrogas and I was not involved. I didn't know we were in default. I didn't know up till today," he replies.
11:37 He says that he was not privy to the meetings.
11:37 Did he participate in any meetings with Alfred Camilleri from the Ministry of Finance? "No," the witness replies.
11:36 He is asked what the €450 million facility guaranteed by the State was used for. "It was used to pay the contractors and developers to get the project up and running. You will see these figures when the audited accounts come out imminently," he replies.
11:34 Apap Bologna adds he is aware of the lending facilities but is not aware of the specifics of how the government guarantee came into place. "I need to go back and look at the detail."
11:33 Comodini Cachia asks if there are emails about this in which he was copied in and Mark Gasan was not. "I will need to double-check," the witness replies.
11:31 She asks whether it is normal that excise duty is exempted. "I am under the impression that it is the consumer who pays excise duty," he replies. "I became aware of the excise tax issue when it came up in the media."
11:29 Comodini Cachia asks whether Konrad Mizzi had negotiated an agreement with Enemalta to absorb €5 million in excise tax due by Electrogas.
11:25 She says that there are other emails to this effect. One of them was from HSBC expressing hesitancy. She asks Apap Bologna whether he was concerned that the lenders were nervous to give Electrogas the loan facility.
11:23 Comodini Cachia reads emails in which Paul Apap Bologna is not copied in. 'From Musayev: Dear all, YF and I spoke to KM... date is not attainable and we are slipping. Need a plan to bridge with lenders, but extension is not on the table.'
11:22 Apap Bologna: "It is an accusation. The finger is being pointed at us without... [evidence]."
11:20 Mallia: "It so happened that her death helped Electrogas reach financial closure. Doesn't that worry you?"
11:19 Apap Bologna: "I can't answer directly as I don't know... the situation as I know it was that we needed financial closure. The reason we hadn't got financial closure was because the government had to submit the contract to the European Commission."
11:18 Judge Mallia: "We know that in December 2017 Electrogas was on the verge of bankruptcy, then it got the government guarantee and subsequently the security of supply agreement. We know at this time that the documents had already been leaked to Daphne Caruana Galizia. Had she not been killed in October 2017, what would the situation have been for Electrogas?"
11:16 "The whole setup is complicated," explains Said Pullicino. "You are involved in many projects." Apap Bologna insists: "I am involved in only one. Electrogas."
11:14 "Gasan wants out," says Lofaro. "I never said that I didn't want out," the witness replies.
11:13 Comodini Cachia notes that Nexia BT was the audit company for GEM holdings.
11:12 "How long have you known Brian Tonna from Nexia BT?" Comodini Cachia asks. Apap Bologna says he met him a few times.
11:09 He says that PWC had advised the company to carry out an audit from a financial and a forensic point of view.
11:07 Apap Bologna: "Of course he counts."
11:07 The Auditor General disagrees, pointed out the board with reference to a National Audit Office report on the procurement process that led to the award of the tender to Electrogas. "Does he not count?"
11:06 Apap Bologna: "We contracted a company to do all the EGM searches. We've just spent a lot of money doing a lot of investigation on the Electrogas project. It's not a risk free project, it had overruns, it is not a risk free project. We did a full report on our company from A-Z and it says there is nothing wrong."
11:04 Questioning moves on about the involvement of Turab Musayev, a representative of Socar on the Electrogas board. Recent allegations about Enemalta's investment in a Montenegro wind power plant, showed how Musayev and Fenech were privately involved in business between themselves. Apap Bologna says he was not aware that Yorgen Fenech had contact with Turab Musayev. "He no longer works for Socar Trading so it was a shock to us to read it in the press," he adds.
11:00 Apap Bologna: "It was only an accusation in the media."
11:00 "You should have been more worried given his reply?"
10:57 He says the Electrogas board had asked Yorgen Fenech if he was the owner of 17 Black but he did not give them a reply. Replying to a question as to whether he was aware of Fenech's ownership of 17 Black, Apap Bologna says he only got to know when it was reported in the media.
10:53 Apap Bologna: "No, we went through all the documents... we contracted a foreign law firm with IT expertise to go through the whole lot independently."
10:52 Comodini Cachia: "You relied on the outcome of an audit which you do not know exactly what it was about."
10:51 He is asked whether as shareholders they took action after the allegations surfaced. "We audited everything from day one... all the way up to the present day," he replies.
10:44 Apap Bologna says there were discussions on the Panama Papers and 17 Black at GEM level. The conclusion was that there was nothing untoward.
10:43 He speaks of the emails "stolen" from the company servers (the leak that ended up with Daphne Caruana Galizia). "It perplexes me, because these accusations are being made... I have an email where Electrogas found out about the leaks on 27 December 2017. They stopped the contract with ICT and they reported it to the police. Still today we do not know who stole this data."
10:41 Apap Bologna: "Of course they did. The concerns were put at rest as the Electrogas directors went through all the records to check for any wrongdoing by the company and that none were found."
10:39 He is asked: "So didn't the Panama Papers concern you?"
10:39 Apap Bologna: "We had a board meeting with Yorgen Fenech, immediately after the 17 Black..."
10:39 He is asked what action he took when the allegations came out in the press.
10:38 Apap Bologna: "Of course they do."
10:37 The board asks: "Doesn't Electrogas or Siemens have some sort of anti-bribery setup?"
10:36 He is asked whether this bothered him. "I didn't question it," Apap Bologna says.
10:36 Apap Bologna says he wasn't aware that Yorgen Fenech had close contact with Joseph Muscat, Konrad Mizzi and Keith Schembri. "I found out well after the bid was being put together from the infrastructure point of view. I found out from the media," he says.
10:34 Comodini Cachia points out that Apap Bologna is now a director. "How are you coping?" Lofaro interjects: "So back in 2007 and 2008, when Yorgen Fenech was not involved, you had the expertise?"
10:33 Comodini Cachia asked if the project was something he believed in. "I did," Apap Bologna replies. She continues: "So why was Yorgen Fenech the first director?" He replies: "Because I didn't have the know-how to put the concept together. With big project management, of course, Yorgen Fenech is more experienced."
10:30 "It was myself and the Gasans at the time. I'm related to the Gasans. At the time, I barely knew the Fenechs," Apap Bologna says.
10:29 Comodini Cachia asks who the "prominent business families" mentioned in the 2007 document were.
10:28 "I totally disagree with that," says the witness. Madam Justice Lofaro interjects: "Maybe they did it behind your back."
10:27 The board asks if the expression of interest published by the Labour government shortly after the election was tailor-made for Electrogas.
10:27 Lawyer Therese Comodini Cachia asks if he could exclude ever discussing the project with members of the then opposition Labour party, even socially. Apap Bologna excludes this.
10:26 Apap Bologna says Konrad Mizzi came out with the energy plan on 9 January, 2013 and he met up with Yorgen Fenech a week to 10 days later.
10:23 Asked about Azerbaijani interests in the project, Apap Bologna says they came in as traders in oil and as equity shareholders. "They were introduced by Gasol and I had no qualms about them at the time," he says.
10:22 Apap Bologna: "The shareholding of the companies was discussed in those six weeks. We also contracted serious companies like PWC to help us put this project together."
10:21 Apap Bologna: "The approach to EDF came through my cousin who worked with them. Yorgen Fenech attended the eventual meeting. In Malta, the chairman of GE was interested in selling the equipment to us but we didn't accept. Socar and Siemens came through Gasol."
10:18 Apap Bologna: "The British company International Power no longer existed, it had been acquired by EDF Suez and they weren't interested. Gasol is British too."
10:18 The panel says that at a point he had decided to unhinge from the British side of the project and go to Azerbaijan.
10:15 Apap Bologna: "What is for sure was that the lead person on the project was Yorgen Fenech. He never said leave the political aspect to me."
10:14 Said Pullicino asks whether he left the political side of the project to Yorgen Fenech. "You need to open up... Things need to be explained," the judge chides.
10:13 Board: "Isn't it in your interest to know him, the leader of the Opposition and future prime minister?"
10:12 Apap Bologna: "I didn't know him."
10:12 Apap Bologna says he met Joseph Muscat socially but had never discussed the project with him. The board is sceptical and press him for more detail.
10:11 Lofaro asks about Keith Schembri. Apap Bologna says he met Keith Schembri, "probably three times in the past seven years". "I didn't meet Keith Schembri about the project," he adds.
10:10 Apap Bologna: "I spoke to him for the infrastructure, the expertise in project management and financial backing. Then I went to speak to his dad. I told him I had spoken to the Gasans in 2007 and the only decent thing to do was to offer them to join us. George Fenech [Yorgen's father] spoke to Joe Gasan."
10:09 What was Fenech's involvement, asks the board.
10:09 He continues that he met Yorgen Fenech around mid-January 2013.
10:08 Apap Bologna: "I didn't meet virtually."
10:08 He says that the first time that he ever met Konrad Mizzi was after the award of the Electrogas contract. The board warn him to be careful. "Please be careful. 'Meet' can be virtually," the board says.
10:06 Apap Bologna: "As far as I know, nobody from my camp approached the Labour government."
10:06 He denies having any discussions before the election. The partners and contractors in the original proposal had all changed except Gasol, he says.
10:05 Lofaro points out that Konrad Mizzi had testified that he had all the details before the election. The board asks if he had met with Konrad Mizzi before the election to discuss the project. He replies: "Not that I know of."
10:01 Apap Bologna: "We presented a 400MW plant in 2017... to change the interconnector into a profit centre not a cost centre. International Power, a UK company, knew about the energy problems in Italy and suggested using the interconnector to sell electricity to Italy."
10:01 Lofaro asks how the project changed.
10:00 Apap Bologna says that this presentation was different to that given in 2013. "The request in the expression of interest was different," he adds.
09:59 Chief justice emeritus Joseph Said Pullicino says Paul Borg Olivier had given the inquiry a presentation on an LNG project, which he said was forwarded to him by the witness. The presentation had been given to the PN government.
09:56 Apap Bologna says that GEM Holdings (Green Energy Malta) was set up. "We would be the green diamond of the Mediterranean," he adds.
09:55 Apap Bologna: "I spoke to Yorgen Fenech... I had bought my first house from the Fenechs. I had bumped into him at a party. They know how to manage big projects, they have the means, so it made sense. In 2008, I had spoken to Mr Gasan. In 2013, it was George Fenech who presented the project to Gasan."
09:54 Apap Bologna: "On 9 January 2013 there was a press release by the Labour Party, several actually, and I thought 'hey we have this project sitting there, why not reactivate it?'"
09:53 Lofaro: "How had the project been reactivated?"
09:53 Madam Justice Abigail Lofaro asks if he had spoken to the Labour Party about the project. "I hadn't," he says.
09:52 He says that then minister John Dalli had introduced him to the prime minister.
09:52 Apap Bologna: "I met with Minister Pullicino who set up a meeting with the resources authority. Pullicino did not attend the meeting at the last minute. We then decided to shelve the project because, although it was a very good project for Malta, things weren't moving forward and then we had the minister not joining his own meeting when we had foreign partners present."
09:50 Apap Bologna says the prime minister had said it was a great project and understood that LNG was the future for Malta.
09:50 He says that it was also presented to then prime minister Lawrence Gonzi, Ministers Austin Gatt, George Pullicino and John Dalli, and PN secretary general Paul Borg Olivier.
09:49 He says that the only cost effective way of reducing Malta's emissions to within limits was to have a gas turbine fired power plant. Apap Bologna adds that the proposal was presented to "quite a number of people in Malta" around 2007 and 2008.
09:47 Apap Bologna was educated abroad and had a lot of his friends abroad. A friend of his had been working in the LNG sector abroad in 2007 - Constantine Obermay. He says they had discussed issues on energy over dinner and a meeting with his friend's boss was arranged. A concept paper was drawn up based on the 2006 energy generation plan policy paper.
09:46 Apap Bologna came to Malta 20 years ago and works primarily in the pharmaceutical industry. "We have diversified and entered in the Electrogas project to build the power station at Delimara," he says.
09:45 Judge Michael Mallia asks him about his background.
09:45 Paul Apap Bologna takes the stand and is administered the oath. He will testify in English.
09:44 Also in the courtroom are Yorgen Fenech's lawyers Gianluca Caruana Curran and Charles Mercieca, sitting at the back observing the proceedings.
09:44 The scene is set for another courtroom session. The judges enter and sit down.
09:36 Yorgen Fenech from the Tumas Group is facing murder charges after being accused of masterminding the assassination of Daphne Caruana Galizia. The journalist had been leaked a massive dump of emails and documents from the Electorgas servers before her murder. Furthermore, Fenech owned a Dubai company, 17 Black, that was listed as a target client of the Panama companies opened by then energy minister Konrad Mizzi and the ex-prime minister's chief of staff Keith Schembri.
09:31 Apap Bologna had been the original promoter of a plan to shift energy generation to gas-fired plants under the Nationalist administration before 2013. However, the PN government at the time had turned down the plan. Eventually, the Labour Party's energy plan unveiled before the 2013 election was similar to the Apap Bologna proposal. The Electrogas consortium eventually won the tender. Electrogas was initially made up of UK company Gasol, German firm Siemen's, Azerbaijan's State oil company Socar and three Maltese businessmen - Apap Bologna, the Tumas and Gasan families. Eventually, Gasol pulled out and its shares were distributed among the other companies.
09:27 We are waiting for another sitting in the Caruana Galizia public inquiry to start. Electrogas shareholders, Paul Apap Bologna and Mark Gasan are expected to testify today.