Mon 1 Jul 2013, 06:20 GMT

Enemalta to buy fuel oil from Shell


Decision comes in the wake of the George Farrugia oil scandal.



Enemalta Corporation will purchase heavy fuel oil from Shell in order to use the product for the operation of its Delimara power station, MaltaToday reports.

The decision comes in the wake of the country's well-publicized oil scandal in which oil trader George Farrugia was accused of corruption in the trade and supply of oil products to Enemalta.

Farrugia acted as agent for commodity trading firms Total Oil Trading SA (TOTSA) and Trafigura via Powerplan Ltd., the oil trading subsidiary of his family business John's Group of Companies. Farrugia fell out with his brothers when they filed a judicial protest accusing him of siphoning off millions of euros in oil profits. The matter was settled in a €1.2 million out of court agreement. Both TOTSA and Trafigura provided the bulk of Enemalta's fuel needs - selling fuel oil, jet fuel, liquid petroleum gas to the corporation since 2003.

Following the scandal, TOTSA and Trafigura have been blacklisted, with the Enemalta procurement board selecting Shell for its heavy fuel oil requirements, according to MaltaToday.

Presidential pardon

Farrugia was granted a presidential pardon in February in return for information on corruption in the trade of oil products to Enemalta. The terms of the pardon also included the repayment of any illegal proceeds made and an additional payment of €250,000 to the government.

The Office of the Prime Minister said that the pardon only applied to crimes related to allegations made on oil procurement before the pardon was issued and that it would be automatically withdrawn if Farrugia failed to disclose the whole truth or if he failed to pass on all profits made from the crime.

Earlier this month, high-ranking police officers are reported to have questioned whether the presidential pardon granted before the country's general election to George Farrugia should be removed. They cast doubt on the effectiveness of the pardon and questioned Farrugia's contribution during the investigation of the Enemalta oil scandal.

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