The Malta Independent 5 December 2021, Sunday

Electrogas shareholder invokes right to silence when asked about GEM board discussions on 17 Black

Kevin Schembri Orland Wednesday, 24 November 2021, 17:31 Last update: about 9 days ago

Former GEM Holdings Director Paul Apap Bologna (who is also a shareholder of the company) invoked his right to silence over questions relating to 17 Black during Wednesday's Public Accounts Committee sitting.

Gem Holdings owns shares in Electrogas. The committee is looking into the NAO report about the electrogas deal.

Apap Bologna was answering many questions put to him by the MPs who sit on the PAC, and while answering the majority, he opted not to answer a particular set of questions.

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PN MP Karol Aquilina was asking him about the Panama Papers, and about the GEM Holdings board meetings held after that event. Among other things, he was asked what the discussions at GEM Holdings board level, regarding the Panama Papers were. "I can't remember exactly what the discussion was (...) I would be able to tell you what was discussed when I go back and see what was discussed and I would come back before you," Apap Bologna said.

Aquilina described the local angle of the Panama Papers, regarding the companies that were owned by Keith Schembri and Konrad Mizzi in Panama, among other things. Asked what the core of the GEM Holding Board's discussion about the Panama Papers was, whether they discussed the issue in general or spoke about Schembri and Mizzi etc. Apap Bologna said: "From what I recollect and I stand to be corrected, we didn't discuss people, we did not discuss companies, we just discussed the fact that this has broken out."

Eventually the questions turned to the 17 Black revelations, that Yorgen Fenech owned it. Fenech was a director of Electrogas at the time. Aquilina asked if this was discussed by the GEM Board of Directors.

"I invoke my right to silence," Apap Bologna said.

He was asked if he remembers when this happened.

"I invoke my right to silence."

He was asked if he was still a GEM Holdings Director when it happened.

"I invoke my right to silence".

He was asked if he and Yorgen Fenech were present for the board meetings at that time and if they discussed it.

"I invoke my right to silence".

He was asked if the board had taken any decisions about what was made public.

"I invoke my right to silence".

He was asked if the GEM board asked its representative in Electrogas to make any verifications. 

"I invoke my right to silence".

He was asked whether he was spoken to by anyone about this.

"I invoke my right to silence".

Lastly on this topic, he was asked if he had made a declaration to the board when this happened.

"I invoke my right to silence".

During the sitting, PN MP and PAC Chairman Beppe Fenech Adami also questioned Apap Bologna about Gasol. Gasol was originally part of the Electrogas consortium, however exited the Maltese consortium in July 2015. upon its exit, Gasol transferred its 3,000 shares - equivalent to a 30% stake in the total share capital of Electrogas - to the other consortium parties, namely Siemens Project Ventures, GEM Holdings and Socar Trading.

Beppe Fenech Adami began questioning the financial viability of Gasol in the first place to form part of the consortium.

Apap Bologna confirmed that Gasol was the lead partner in the project, describing them as "the people putting the project together, who had the technical knowledge."

He was asked if he was aware that, in 2014 Gasol had lost than more than 55% of its value on the London Stock Exchange (LSE). "No I didn't," Apap Bologna said.

Fenech Adami said that on the 25 June 2014, according to the LSE, lost 55.8% of its value. "So you, who were I imagine conducting the exercise to see who to do this project with, you didn't check the strength of Gasol?" Fenech Adami asked.

"Gasol was and as stipulated in the NAO report, guaranteed by SOCAR, but also Gasol was the sister company of Afren which was a multi-million euro company on the LSE," Apap Bologna said. He said Gasol was supported by other companies.

Asked further about this, Apap Bologna also said that he was not part of the negotiating team. "At the end of the day, when all of this was happening, we eventually found out when things started happening and we needed to step in. I was not privy to that information before hand."

Fenech Adami said he found it difficult to believe "that you were not aware of a fact that Gasol lost 55.8% of its value in the year when you were negotiating this marvellous deal." Fenech Adami then read from the 2014 audited accounts of Gasol, "The group does not currently hold sufficient cash or liquid assets in order to meet its commitments as they fall due for the next 12 months."  Fenech Adami continued to read: "the company is likely to be required to obtain significant capital in the future. There is no assurance that it will be able to raise such capital that is required and that the terms associated with providing such capital will be satisfactory to the company."  

Fenech Adami said that this was at the moment that the consortium was being formed and at the moment Gasol was being made the lead partner in the project. "It did not make sense to do business with them," Fenech Adami added.

Apap Bologna said: "I was not privvy to that. But as I said before this was being supported by a guarantee from SOCAR Trading, which is stated in the NAO report." He said that from what he knows all the accounts were submitted to the auditor as was the guarantee, saying that it was all transparent.

Pressed for the reason why they included Gasol in the consortium when they had to buy them out some time later, Apap Bologna said: "Gasol came into the project because Gasol were the people who brought in Siemens, SOCAR and everyone else. Without Gasol at the beginning this project could not have moved forward. So that is why Gasol came in in the first place." He again mentioned that Afren was supporting Gasol at the time when they were working with Gasol.

During the sitting, he was also asked about the proposal which Apap Bologna had made to the PN government in 2006 for a gas power station.  Apap Bologna said that it was not up to him to interpret why the PN had changed policy to stick with heavy fuel oil at the time, but said he felt LNG was the way forward for Malta, being both cheaper and more environmentally friendly.

He said he had held meetings with then Prime Minister Lawrence gonzi as well as George Pullicino, John Dalli and Austin Gatt, but denied consulting with the PL opposition at the time.

Apap Bologna also held that he had not discussed the power station proposal with the PL prior to the 2013 election.

He was asked by PL whip Glenn Beddingfield whether he had ever bribed anyone in connection with the project. Apap Bologna responded: "I have never paid anybody anything in my life in connection with this project."

Apap Bologna also said that the plans in 2006 were different from the final project. One such difference was that in 2006, the idea was for a 400 MW plant, so that Enemalta could sell electricity to Sicily. Another was that the regassification plant was on a sea vessel and not on land. 

Apap bologna was assisted by lawyer Giannella de Marco

At the beginning of the sitting, Fenech Adami said that on Monday he received an email from Mizzi's lawyers informing the committee that Mizzi is still in hospital and not in a position to attend the PAC meeting due to health reasons. "They said that he would also need some time after he is discharged and that they would inform the PAC as soon as possible of his availability to appear before the committee on the basis of medical advice." 

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