Muscat has hidden more than €250 million in costs
“This evening, I presented a report compiled by the international auditing firm KPMG.
KPMG has concluded that Muscat’s plan will result in a 5% increase in energy tariffs.
Muscat has purposely undervalued the construction of his power station by €74 million.
He has left out the €50 million required to build a jetty for tankers to berth and €40 million for the construction of two gas tanks. And he’s hidden the €100 million needed for the purchase of tankers to transport liquefied gas.
Muscat has hidden over €250 million in additional costs. And although he’s hidden them from you, you will be the one who ultimately pays for them, either through higher energy tariffs or higher taxes.”
– Tonio Fenech, this afternoon
See this? I keep a spare one hidden in my pants in case this doesn’t work.
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Did Tonio Fenech include the cost of converting the existing plants from HFO to LNG? If not Joseph’s computer made another €80 million error.
This is a dog’s breakfast.
After going through your previous articles and following what is going on at the moment I am truly convinced that your article regarding reverse engineering is correct.
I strongly suspect that all the numbers go around the 9c6.
This is because 9c6 sub consciously reminds people of the 1996 labour victory.
Although they are not proud to mention that date, one still associates 96 with something victorious.
This is psycological propaganda at its worst. Someone big and powerful must be helping Labour.
Not much is being said about the fact that for 25 years the supply of the first 200MW will be contractually in the hands of a private entity.
Assuming against all odds that this private entity will agree to a ten year fixed price, and thus bear the loss of the eventual rise in LNG, shipping, operational costs, during that period, it stands to reason that on the tenth anniversary, the charges unhinge and will soar to a cost plus profit plus recouping of loss and initial investment.
And we will have to smile and bear it.
This bodes farewell to our economy after 2024 – by which time other countries in the EU would have the luxury of energy mix options to cheaper new renewable sources such as geothermal options to mention only one.
Another point being missed is that EU Procurement Rules are there to avoid corruption and kick backs. Yet, Konrad Mizzi and Muscat are going to forego any tender process on the pretext that they cannot wait to save us from cancer factories and poverty.
Ellul Vincenti , if I remember was the person who also thought that having wind turbines on Dingli heights was feasible, and he wanted to build these turbines and sell the energy to us taxpayers at subsidized rated that would guarantee his profits and our price increases. Another axe grinder.
Did the KPMG take into consideration the 25 million Euro per year required, in subsidising the reduction of the bills, until the new plant is up and running?
How come KPMG personnel were not present at the press conference to answer journalists?
[Daphne – Because they are not politicians. It is the politicians who are questioned in political situations, and not the people working away in the backroom. The buck stops with the politicians. Konrad is out there not because he is a consultant, but in his role as a politician. You’re forgetting that.]
Labour had representatives from DNV Kema to answer journalists.
[Daphne – For the flipside of what I described above: it doesn’t wish to be confronted with political questions, and has stuck the argument, with the perhaps unwitting compliance of journalists, to the technical issues. But politicians are there to take political responsibility, and should be asked political questions.]
Have you read the presentation? It is so amateurish. I never thought KPMG would stoop so low.
[Daphne – Oh grow up, honestly. A KPMG report being called amateurship by a 19-year-old law student who can barely write or think.]
I bet they were pressured by Tonio Fenech to do it. They locked up themselves in a room guessing a number with Tonio suggesting oh, put it 19c because we don’t have time to rebut labour’s proposal. People are believing them. You know what? He came out less credible with a report written in one day. Hilarious.
I am asking Labour to produce a table with figures which the consumer has to pay, before and after situation.
That would be a clear picture for Pawlu u Mary.
Pawlu will tell Mary, “Mer taf kemm ser nifrankaw bis-sejl ta’ Joseph, xi €8 fix-xahar”. Nivvutawlu ghax qeridna dan il-gvern”
What about us who installed the panels? I received the bill and it reads €0.00 & €309.00 in credit.
And now, what have the Employers Association and, in particular, Tony Zahra of the MHRA who had praised the Joseph Muscat energy plan with such alacrity, have to say to that?
Both owe an explanation of their action, not only to their members, but also to the public for endorsing and promoting what is nothing more than an electoral scam to the ultimate detriment of tax payers.
Some very recent interesting cost info can be found here
http://www.itps-online.com/media-center/
Read news item titled “Linde to build LNG terminal in Sweden”
The best part (below) tells that the cost of building a 30,000 m3 LNG import terminal which excludes the tanks, will cost around €44M. In Norway, the terminal alone will take 16 months to build!
“The technology company The Linde Group has been commissioned by Norwegian-based Skangass AS to build a mid-scale liquefied natural gas (LNG) import terminal at the west coast of Sweden, in Lysekil, 100 km north of Gothenburg. The corresponding engineering, procurement, construction and installation (EPCI) contract is worth around EUR 44 m. The works include the integration of the cryogenic tank structures to be erected by a third party. The new LNG terminal is planned to start operations in spring 2014 and will supply natural gas to the nearby Preem refinery as well as LNG for industrial and transportation applications.
So, according to Konrad Mizzi on TV, it took Labour three years to develop this half baked and deceptive proposal.
And now they expect us to believe that they will deliver this project in two years.
I clarify that Konrad Mizzi did not refer to his proposal as half-baked and deceptive, of course. He has full confidence in his proposal.
The worry with PN is that they might break their promises. The worry with PL is that they might keep theirs.
If I am not mistaken, the 5 % increase calculation was made using the price of gas today.
It is predicted that the price of gas will more than double in a few years’ time.
The power station will take 4 or 5 years to build. So by that the time the actual cost will be much higher and the increase would be much more than 5%.
http://www.post-gazette.com/stories/business/news/us-report-predicts-rising-natural-gas-prices-in-2013-14-669602/
…and that is just tip of the iceberg
Call me a conspiracy theorist, but that’s the deal we’re not allowed to know.
The jetty, tanks and ships aren’t our business, I think when Konrad stated these could be a spin off for operators like Shell, he should have put it the other way round.
It looks more like the proposed station would be traded against the concession to what’s really going to take place.
Coincidentally, their forecast for the pipeline is ten years. This from the same people who said they’ll do away with bureaucracy. Being disingenuous and idiotic is one and the same with these people.
Konrad was clear where everything starts, government will provide the land. What seems to matter is that the source of gas is decided by others.
Still, I could be seeing too much into this. If so, it’s worse.
Bongu….just biex nigbidlek l-attenzjoni li la Maltatoday, la inews u lanqas Maltastar ma gabu xejn fuq x’qal Muscat fuq addotazzjoni ta’ tfal minn koppji gay.
Have a nice day and keep up the good work.
Il-Laburist jafu? U minn fejn ha gibhom?
http://www.timesofmalta.com/articles/view/20130115/elections-news/muscat-promises-to-cut-bureaucracy-by-a-quarter.453254
It-tim maghqud.
‘A commissioner would be appointed to simplify administration and fight bureaucracy and laws would be better consolidated…’
Yes, prime minister.
But will voters understand this? Will it be a repeat performance of the VAT thing? Will they fall for the gimmick that some associations have “lauded” Joseph’s project?
Are they willing to look beyond the screen that has been placed before their eyes by the soft and quick talking of Konrad Mizzi?
There are only two possible interpretations to this situation: either Labour genuinely overlooked the side implications ignoring the relative costs which amount to millions, or else was all along aware of them and consciously left them out so as to project the costs as containable and so financially doable.
This implies that if the former is true, it only reflects their incompetence to assume responsibility to govern, or else, if on the other hand the latter applies, this was a most deceitful strategy.
In either case they cannot be trusted.
I saw and listened attentively to Ann Fenech, a specialist in maritime law. She knows her subject, and she’s the one who knows the ropes on the purchase of fuels.
She’s an authority. And yet “issa se nwiegbek ghal-kollox” “issa ingiblek il-kuntratti” Konrad Mizzi had the cheek to brush away her expertise.
This is what happens when so called professionals in their field bluff their way in other professionals’ territory.
Konrad Mizzi can no longer be considered as an expert; he’s been downgraded to a village politician like poor old Anglu.
Where was this bright woman hidden for all these years?
http://www.expertguides.com/default.asp?page=2&egaBOBID=&CountryID=51&ExpertOfficeID=30498&GuideID=236&fcIndex=1209&fIndex=481
[Daphne – Another St Dorothy’s girl. We were on the same school-bus.]
I watched Ing Mark Anthony Sammut giving enough rope to Konrad Mizzi on TVAM, to hang himself.
I like Mark’s technical point when he stated that it would be structurally near to impossible to build the Gas Tanks and placed on the Delimara peninsula, with the dimensions cited by the Labour Party.
It is pertinent to note that Joe Ellul Vincenti yesterday shied away from the nitty gritty of the structure of the gas tanks, probably he smelt a problem.
On a lighter side: the Labour Party wasn’t even able to coordinate a simple laying of wreaths on four national monuments by its most important figure, let alone the building of a new power station. Actually they never built a new one.
Watch the first part of the lower video in this report .Yet the people still clap to whatever he says or does.
http://www.timesofmalta.com/articles/view/20130112/elections-news/companies-talk-to-labour-about-energy-plans.452943
At the rate we’re going we will soon be seeing him laying a wreath on the Luqa monument !
So given that its most probable that PL will be in government, there is no chance of the tax cut detailed in last budget being ever implemented. Damn Franco.
International Article ‘The Occasional Failure in VAT Implementation:’
Malta featured thanks to Labour
http://unpan1.un.org/intradoc/groups/public/documents/unpan/unpan019991.pdf
Well although he did, I realised that he had done so only an hour after he had presented his project. I did simple maths and I immediately came to the quick figure of 600 million and that was without the jetty – and I’m a simple housewife not an accountant.
Off topic here, excuse the imposition. Is Franco in Coventry for the proceedings? His bubble has finally burst and irrelevance is in evidence. Just an evidence-based observation.
In Malta Today’s story “Different polls, same bad news for PN” the graph chart gives a blue bar for Labour and a red one for the PN. Interesting.
According to Joe Grima, yesterday in some programme, the tankers to carry the liquefied gas already exist and there’s no need for building new ones.
Can we make this clear, to my knowledge there seems to be only a couple around and they’re being used elsewhere and will not be available for Muscat’s power station.
To be fair though, they concluded this using the information that the Nationalists gave them.
In my opinion we should take this into the scenario.
Cyprus is on the verge of requesting a bailout from the EU, Malta included.
I therefore am apt to consider Cyprus’s portion from Malta’s contribution towards that bailout to amount to a barter agreement.
http://www.timesofmalta.com/articles/view/20090807/local/call-for-expressions-of-interest-in-undersea-electricity-link.268447
Politicians are essentially salesmen, and like all salesmen, they will tell you anything you want to hear to close the sale.
In this case, they are trying to sell you their vision so that they obtain, or retain, the hot seat.
This is the time when their salesmanship skills go into overdrive, oozing apologetic speeches beckoning forgiveness for things not going according to plan, or churning up revolutionary alternative solutions to most of the things we had grown, willingly or not, accustomed to.
Frankly I am not surprised we have not been given the full picture of the power plan revolution being promised by Labour, nor am I surprised for them not presenting detailed financials or the plan, because there are none.
There again we were told Mater Dei would cost Lm110 million and it ended up costing Lm 280 million (both figures plus or minus a few million of course). So quite honestly, we are all used to be taken for a ride by the political class that profess governing us for the good of the nation.
Joseph Muscat has been rumbling on lowering utilities tariffs since his piloted climb to party leadership and it was no surprise that he chose this to be his ‘cavallo di battaglia’ for this campaign.
Having taken this calculated gamble, he is now faced with what could possibly be a counter-productive predicament.
The PN apparatus and all experts (affiliated or not to the party) will dissect this proposal to the point that doubts will be raised across the board.
If this inevitable exercise manages to prove that Labour’s energy plan is flawed, and I am not saying it is, than Labour’s plan to win over those that are ‘not so sure what to do with their vote’ might not succeed.
Because let’s face it, it’s not that Muscat and Gonzi are trying to persuade hard-core partisans to vote for them, for that vote is assured.
The battle here is to win over those more commonly known as ‘floating voters’ but which I prefer to call ‘dormant voters’ (as in disgruntled voters most of which being PN ‘afficionados’) who choose to ignore politics because they feel let down in some way or other.
Just keep in mind that the last election was won by 1580 votes over 290755 votes cast. Nothing is set in stone and both parties need to tread lightly. As for promises that are set to be broken, brace yourselves because in the coming weeks there are more to come.
What about MaltaToday’s article on poll results which shows the PL with a blue bar and PN with a red one in the graphic? WTF.
It’s funny how PL are taking this to the extreme including their collaborators at MaltaToday. They must have seen some documentary on National Geographic or BBC about colour psychology.
http://maltatoday.com.mt/en/newsdetails/news/data/Different-polls-same-bad-news-for-PN-20130114
After the press conference today by Miles Seaman, Jesmond Mugliett and Joe Ellul Vincenti have a lot of explanations to make.
One point which has received very little attention is that the gas tanks will be constructed from concrete.
Now with the prospect of building two Mosta domes, that’s a lot of concrete that is going to be used down there in Delimara.
It may be interesting to see who may be interested in the Expression of Interest because of this part of the ‘project.’
It seems that the PL want to use only 20% of the interconnecter which means building another power station and generating the extra 140 MWh in Malta.
This will amount to 120 tonnes of carbon dioxide emitted locally in Malta per hour which we would avoided if we by electricity from abroad.
This amounts to about 1 MILLION tonnes of carbon dioxide per year! Why are they promoting their venture as bringing cleaner air for Malta.
This is an all round ‘brikunata’ kbira, and the sooner the electors understand this the better.
They have nothing to offer except the bait of the reduction of tariffs, and so far they managed to hijack the electoral campain with just this one proposal.
Yesterday I watched Charles Mangion and Marelene Farrugia making an a** of themselves on Net TV, and later I watched Konrad Mizzi trying to make out an arungent when he hasn’t got one.
Tonio Fenech demolished him yet another time, and he was getting confused as the programme progressed. Even Lou Bondi looked uncomfortable as he was not getting the answers to his valid questions.
Lou’s questions were relevant and to the point, but all he got was empty talk.
Konrad also showed signs of panic at certain times as he is realising that his proposal has bees made to shreds so early in the campain.
He is the do-or-die for the PL and no PL speaker can enlarge on this point because the deal is top secret with the leadership only.
Marlene Farrugia yesterday could not answer a direct question as to how much she is involved as the PL spokes person on energy, and in a panic she started to behave like a washer-woman, with apologies to washer women.
The residents of Marsaxlokk have been silencend by the PL and are afraid to express their opinion.
The mayor should start asking questions about the safety of the village and its residents. But here I am expecting too much because these people are all ‘bla b***’.
Trasparenza ta’ z….
During today’s PL conference, Konrad Mizzi confirmed that the PL shall be pursuing the EU funds for the gas pipeline.
This statement shed’s further serious doubts on the PL’s energy proposal:
1. Why was not this never mentioned during their ‘sales’ presentation of last week?
2. Have the PL factored these additional costs in their ‘doable’ plan?
3. Considering that the new power stations shall be run (at a profit) by the private sector, are we still eligible for EU funding?
4. The cost of the gas pipe line has been estimated by the PN at approx. €273M, what shall be the level of EU funding? and what shall be the additional investment by the private sector? thus the additional costs on the ‘9c6’ production cost as being persistently quoted by Mr. Mizzi?
The PL should make it clear to one and all that the energy proposal it has laid down, and which cannot be considered as a preliminary proposal, given the tight time frames, is a ‘doable’ plan and which shall not affect our and our children’s future in the mid long term future
He should be ashamed of himself and his party.
The PL proposal is sounding madder by the day and its clear that Konrad Mizzi is inventing the story as he goes along. I sure hope he will be around when it all unravels and the country sinks.
You can tell that he is unsure by looking at his eyes which are all the time shifting around seeking some kind of support for what he is saying.
This is turning into a nightmare.
Can we know whether KPMG were commissioned and paid by the P.N. or by the Govt ?
Did KPMG make use of the original copy of the proposal, or was it based on details supplied by EneMalta?
Can we have a list of all the Dissclaimers by KPMG?
Was there, at least One instance when KPMG needed further explantion on any point of the proposals if so did they seek this from K.Mizzi?
[Daphne – You should already know that, Silvio. The answer was given at that same press conference. But you told us you were going to watch Mr Bean instead. So lump it.]
OUCH. I really deserved that.
[Daphne – Yes. You did.]
Oh, so that is what it is.
I was feeling jealous thinking he was more well endowed than me.
http://www.timesofmalta.com/articles/view/20130115/elections-news/pl-says.453355#comment_1624461
Edward Mallia
Yesterday, 20:34
The gas pipeline will render the expensive LNG storage tanks redundant; same for the even more expensive re-gasifier, required to convert liquid NG to gas before it is fed to the turbines and engines. Beats me why the PL is insisting on putting in a pipeline, particularly with the never-never time scale of 7 or 10 years depending who you hear ONE TV or Konrad Mizzi.
May I add the expenses for the quays and the special pipes to offload the frozen gas in liquified form.
Dak jecita ruhu meta jitkellem u ikun hemm l-irgiel jharsu lejh.
If Muscat’s plan doesn’t quite work out, it will be something bigger that gets past our underpants.
Page last updated at 02:29 GMT, Wednesday, 16 January 2013
Watchdog warns on private funding
New toll roads are expected to open under the government’s investment plans
Taxpayers risk “substantial losses” as a consequence of coalition policy on funding new infrastructure, the National Audit Office has warned.
The government is offering to underwrite private investment in major road, rail and energy schemes.
But the spending watchdog warned this could increase the burden on the public as consumers rather than taxpayers.
It urged ministers to be “realistic” about the prospect of costly overruns if the projects do not run smoothly.
The Treasury has projected that £310bn will be spent on current and planned energy, rail, roads, water, waste, flood defences and digital communications projects.
It predicts that 64% of that funding will come from private companies.
‘Over-optimistic’
In a report on the coalition’s infrastructure plans, the National Audit Office said that reducing reliance on state funding could “increase bills for consumers and increase pressure on household finances”.
This could lead to “unplanned taxpayer support” for people in hardship, it added.
It called on the government and regulators to clarify the financial impact on consumers of the infrastructure plans.
The watchdog also warned that the government’s calculation of the extent of the UK’s need for infrastructure investment might be inaccurate.
Its report highlighted poor forecasting about passenger demand for the Channel Tunnel Rail Link, which had “proved over-optimistic”.
Actual passenger numbers between 2007 to 2011 had been about one-third of the level expected initially, and the financing scheme for this project had turned out to be “not sustainable”, the report said.
‘Exasperated’
National Audit Office chief Amyas Morse said: “Economic infrastructure keeps the country running. Demand for infrastructure is set to increase, fuelled by population growth, technological progress, climate change and congestion.
“But there is a lot at stake in taking forward the national infrastructure plan in an environment of straitened resources, with real risks to value for money and uncertainty about the sustainability of piling costs on to consumers.”
“Work is already in hand to drive down the costs of delivering new infrastructure and this should continue.”
Commons Public Accounts Committee chair and Labour MP Margaret Hodge said: “The government’s indecision over infrastructure policy deters investors who seek certainty in exchange for long-term financial commitments.
“A shift towards relying on private investment will inevitably see consumers picking up the tab through higher energy and water bills, internet charges and train fares.
“Consumers will be exasperated to hear that the government has not even made the effort to assess the future impact this will have on their already hard-pressed household budgets.”
But the government believes its UK Guarantees scheme will help kick-start projects which have stalled due to problems raising funds.
A Treasury spokesman said the government was “on track to reduce the cost of infrastructure delivery by £2-3bn, which will save consumers money, as well as making services more affordable across sectors including the energy market reforms and rail sector reforms”.
Projects approved under the scheme need to meet criteria, including being able to begin work within 12 months, and demonstrate that they will boost economic growth and provide good value for taxpayers.
BBC © 2013
http://jezebel.com/5954617/cnn-thinks-crazy-ladies-cant-help-voting-with-their-vaginas-instead-of-their-brains?tag=genderal-interest
Ladies beware come 9th March.
Lots of men are planning to vote for that prick hiding behind a blue tie.
What does that tell you?
That they probably are all vaginas.
Yesterday Konrad Mizzi again re-iterated that no tender will be issued but an expression of interest. Has it occured to anyone yet what this effectively means?
It means that this:
1. shall not be subject to public or legal scrutiny;
2. allows the PL to shortlist anyone they want while also excluding anyone they want;
3. does not allow a company who has not been shortlisted to appeal (since it is not a tender);
4. means that if someone has already been earmarked by the PL for this project – which must be the case given that they keep insisting on the figures provided, this company can be chosen freely with no questions asked…because you know it is an expression of interest and not a tender.
http://www.timesofmalta.com/articles/view/20130115/elections-news/muscat-resignation-pledge-means-taking-the-easy-way-out-gonzi.453361
Is there a link to the plan for the new Delimara tank site online please?
I can’t find one.
[Daphne – There isn’t. Even though Labour makes a meal of the need for everyone else to be transparent.]
Today’s The Times pullout features Labour’s pledges. My, what an exhaustive list, including No Tax on Minimum Incomes, which is an outlay of Eur120,000 in total, MPs’ pay linked to attendance, cut red tape by 25%, yes 25%.
Unbelievable after 25 years in opposition, and they come up with this list.
And everything is ticked off, which signals it’s all done.
So Joseph can concentrate on his public image in the EU presidency and V18 preparations, together with Me Shall Peron.
A bit slow, aren’t they? Their campaign website says nothing of the kind.
Maybe they think that the tal-pepe voters read The Times and don’t bother with the internet?
That was a response to David S. ‘They’ = PL.
Sometimes I wonder whether this is a plan for the Maltese Socialist Party to take Malta out of the EU.
@ roger: re your no.4 “….someone has already been earmarked by the PL for this project….”
Did anyone notice what ex MLP minister Reno Calleja said the other day on a TVM programme:
* that China is almost his second home
* referred to Konrad Mizzi as “the Golden Boy tal-partit”
* Konrad’s (Chinese) wife wanted to make aquaintance with him (Reno)
It seems to me that Labour simply want to do the opposite of whatever the Nationalists propose, no matter what the consequences.
You do realise that while there is a lack of consensus on even the most basic of things like water and electricity then Malta will remain a backwoods haven for petty bickering.
It’s your fault, no it’s your fault.
Sad.
Algeria will soon be commemorating a sad 9th anniversary on the 19th January when an LNG plant at the port of Skikda, eastern Algeria,exploded killing 27 and….read on here:
http://home.vicnet.net.au/~auranet/dampier/web/LNG.html
Tonio Fenech says that costs will increase by an extra €250m. But if Joseph is right and Enemalta will spare some €174m per year, the extra incurred costs can be paid back in a couple of years.
So it still makes sense to build a new power station on natural gas right away.
As an engineer who has some good knowledge in the energy field, I am in favour of another power station. We will have a better security of supply as we cannot depend on just an interconnector. More to that efficiencies will rise and negative health outcomes should diminish.
On the other hand, Joseph’s idea to build a power station within the next two years including all permits and run tests is full fantasy.
I estimate that we would require a minimum of five years, six years being more acceptable.
Just WHAT is a PL governemnt going to do to ensure it´s in line with EU regulations without following the procurement rules?
Am I missing something or is the PL being cagey about this? I don’t see how this a 25-year contract could be given at will to any company.
http://www.maltatoday.com.mt/en/newsdetails/news/elections2013/transparency-public-tender-Muscat-20130116