Sandro Chetcuti and the invisible King of Monte Kristo back Joseph Muscat’s cunning plan. Be still, my beating heart.
Is this circus act going to carry on for much longer? ‘The Malta Developers Association’ sounds sonorous and impressive, until you know who’s behind it.
The president of the association, Michael Falzon, is not discernibly pro-Labour (he is a former Nationalist minister) but he can’t stand Lawrence Gonzi’s guts and notoriously so.
The vice-president, Sandro Chetcuti, helped set up the Labour Party’s business forum and organised business networking meetings, lunches and suppers for Joseph Muscat, besides raising funds for Labour, until he became embroiled in that nasty business with Vince Farrugia. Muscat was the special guest at his big-splash birthday party.
The secretary, Ian Fitzpatrick, isn’t even involved in real estate development at all, but describes himself as a “Revenue Management Trainer at International academy of hospitality and catering studies”.
You know, it’s really difficult to take statements like theirs seriously. The tragic thing is that lots of people will.
And I am very nervous about a situation in which the Labour Party is backed by land developers. This is because I know that several key politicians within the Labour Party see this as a good way of making money for themselves privately, and even if it might be legitimate, it’s really not a good look.
Charles Mangion, for instance, is the notary used on many major, really major land deals. His conflict of interest is massive, and nobody speaks about the elephant in the room.
And in any case, I lived through the years of Labour government and I know as others do that the corruption, human savagery (does anyone remember the poor accountant hacked to pieces and found in a disused well?) and environmental degradation of those robber-baron years were absolutely terrible.
In The Times today:
DEVELOPERS AGREE WITH ‘DOABLE’ CLAIM
Labour’s energy project is “doable”, according to the developers’ association, but it doubted whether the proposals could be implemented within two years.
On Tuesday the Labour Party unveiled a detailed €370 million plan to convert the Delimara power station to gas, which, it says, will lead to an average 25 per cent cut in utility bills.
The Malta Developers’ Association said it considered the political discussion on electricity tariffs a “positive development” because lowering such tariffs could be the key to a “stronger, more vibrant Maltese economy”.
“The positive effect of cheaper tariffs on the scale indicated by the Labour Party on the Maltese economy would undoubtedly be enormous and would stimulate the business sector to contribute further for the good of Maltese society and its further progress,”it said.
“MDA appreciates the Labour Party’s effort to put together its proposal and feels it is a serious attempt to solve the problem through a doable project, athough it is preoccupied on how possible it is for the project to be complete in two years.”
The association also noted that the proposal led to a mature discussion on the energy sector
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And where is Astrid of the FAA ? Struck deaf and dumb ?
A few months ago you had spoken about a land deal involving Yana Mintoff, Caqnu and some Marsaxlokk land, could it be that the power station extention and or oil tanks will be placed on such land bought from the developer at high prices (since this si now within the alloowed development zone) ? can some one find out?
[Daphne – No, it’s nowhere near there. The land the Mintoff sisters sold is close to houses.]
Finally, some insight into how Joseph Muscat arrived at his energy plan:
http://i.imgur.com/BdSnM.jpg
http://www.timesofmalta.com/articles/view/20130111/world/moody-s-downgrades-cyprus-to-caa3-warns-may-cut-more.452735
According to Joseph, we should we have followed Cyprus’ example. He can’t get one right.
There is something which puzzles and I would like an answer from Konrad Mizzi.
He states that the power station would work 95 per cent of the time.
This would produce double the amount of energy that we need.
According to him, the cost would be 9c6 per unit of electricity. Now this will be the cost of energy produced, not of the energy used. If the surplus energy is not used but simply wasted, the actual cost of energy which is actually used would be double i.e. 19c2 per unit.
Am I wrong in my reasoning? Can someone explain please?
I thought about basically the same thing when I heard him – but I don’t have a clue how it works in practice when it comes to production costs vs supply price.
Good point.
They said the proposal is “doable.” Maybe they meant “double” and it was just another misprint?
How can I upload a pic to your blog?
[Daphne – No, but you can email it to me at [email protected]. Otherwise, use a picture-upload site and then send in the link as a comment.]
These are all small islands which had to choose between going either for petroleum or gas and they chose petroleum.
http://www.maltatoday.com.mt/en/todaynews
video 7:40 … Michael Falzon says that “anke’ jien, li kieku kelli nghid minghandu ragun (bejn Tonio Fenech u Konrad Mizzi) nghidlek ma nafx”.
Then why does he endorse a press release of the MDA of which he is president which says that Labour’s plans are doable?
Ian Fitzpatrick – not at all impressed.
Actually its: ABELA Fitzpatrick.
Look him up.
Of course it’s doable. Everything is doable if you throw money and effort at it. The question is, is it worth doing? What is the point of having another power station when the spanking new Delimara power station is more than adequate for our current and immediate future requirements?
http://www.timesofmalta.com/articles/view/20130111/elections-news/muscat-promises-more-gender-equality.452824
“Muscat promises more gender equality”
Promising everything to everybody (not that I have anything about gender equality, far from it) but he seems to be targeting every demographic secor. In this particular case he should have had il-dik or Me Shall with him, or not ?
LNG is cheap and affordable in the near-term because of oversupply and this plays well for Labour’s proposal today. By the time a new PL government preferred bidder builds the new power station it will increase considerably in price – huge China demand expected (China alone will imports 42% more LNG this year). I believe that in the long term we will be better served by the interconnector (due to economies of scale – adding Malta to an established grid it’s like bringing a big city online)
Checkout these future NYMEX contracts:
http://futures.tradingcharts.com/marketquotes/NG.html
Last year’s Feb 2012 future contract (on NYMEX) was at around $2.00/MMBTU (all-time low). Feb 2014 future contracts already priced double that amount to $4.13/MMBTU
And here’s why PL will abandon the LNG tanker transhipment and settle for the gas pipeline alternative – Joseph already warming up to this idea in today’s news.
‘Given the strong uptrend in LNG demand, the tanker fleet will need to grow by an additional 100 ships by 2020. Given that an LNG tanker costs around $210 million to build, that’s a tall order.’
‘A recent survey conducted by Bloomberg shows that median analyst estimates for LNG day rates will average $147,000 in 2012.’
http://investorplace.com/2012/03/hop-aboard-the-boom-in-lng-shippers/
Personally I think it’s a strategic mistake leaving energy production for a small market to a private entity – wouldn’t make any sense for any other competitor to venture in. Looking forward to an unbiased economist and engineer review of the proposal
I’ve learned not to look forward to that sort of thing, because it’ll never happen. Your post is more than we can ever expect from any Maltese economist or engineer.
As an international economist, having travelled the world for so many years, I consider the proposal very appropriate for a new Ian Fleming, James Bond film.
Title: ‘A GASP TOO FAR’.
Nice line-up the MDA has there.
Michael Falzon? He has had an axe to grind with the P.N. since the day he was not re-elected to parliament.
Well now people know why he wasn’t re-elected..
Elections in Malta are decided by floating voters and luckily they (floating voters) have the ounce of intelligence that’s necessary to realise that in Malta a PN government has made Malta the envy of other European countries.
Which is why no opposition can compare to the current government – then when presenting people like Toni Abela (and the lot) just makes everything even clearer.
Why the surprise?
Even for James Debono, the illustrious analyst of MT,
“It also offers what seems to be a win-win situation: conversion to a more environmentally friendly gas with €300 million expenditure forked out by a private company, ensuring that the burden will not fall on taxpayers. Surely this fits perfectly with Labour’s “no pain, all gain” narrative.”
Incredible.
So presumably, had James Debono the inclination to “tender” for Labour’s enticing offer of providing Enemalta with its cheap energy needs, he would invest €300M to build a power station, and when he comes to working out the energy unit price that he’d be charging Enemalta, he’d only factor in operating costs and a little profit on the side, and FORGET about the €300M and any interest on loans, presumably thinking that at the end of his supply contract, his power station would be worth €300M + interest, perhaps even more, and he’d have buyers queuing up.
All this to ensure that he’d be carrying the burden instead of the taxpayers, and to give the government a win-win situation to fit perfectly with the government’s no pain all gain narrative, no doubt.
Is that Chetcuti’s mugshot?
Few will under stand this but the real problem of the power station or rather power generation in Malta lies with the developers.
If the same quality of residential buildings is kept, whoever wins the election can automatically build another three power stations to keep up with energy loss that has become standard with building developers.
If any of the parties really develop a long term energy policy, the first to get a close look at the guillotine would be the building developers whereby the construction methods and expenses would increase but having to keep the present or lower house prices.
So MDA have really no idea where they are coming from or going to.
Now whether they like it or not they will come to some sour end and this does not depend on the local government but is the long term action plan of many instituted and future Directives.
From what it is being say and written, only the cost of production is being mentioned – no reference at all to the distribution cost.
Moreover, the contractor will have to cover the cost of the capital outlay, the interest paid on such capital (to built the new Power House) and add its share of profit – so how can one decide for an unknown supplier/contractor what would be the final cost?
There are so many variables that the final ‘cost’ propably would be risky and hence not worth venturing.