Revealed: How Malta lobbied to win EU backing for gas pipeline linked to journalist’s murder

Negotiators from the European Parliament, the European Commission and the 27 EU countries concluded negotiations on rules for supporting infrustructure projects early on Wednesday morning. [@KadriSimson / Twitter]

In a rare move, the Maltese government sent letters to Members of the European Parliament one week before a crucial EU negotiation in an attempt to persuade them to support a controversial gas pipeline connecting the Mediterranean island to Italy’s gas network.

The ‘Melita’ pipeline project linking Malta to Sicily was granted an exception in new rules governing how energy infrastructure projects can get priority EU status, making it eligible to receive EU funds.

The decision came at 5:40 a.m on Wednesday (15 December) after a long night of negotiations that saw representatives of the European Parliament and the 27 EU member states reach a provisional agreement on the EU’s revised regulation on Trans-European Networks for Energy (TEN-E).

Although the revised TEN-E rules place the emphasis on renewable energies and electricity interconnections, some gas infrastructure projects also ended up receiving support from EU legislators.

Among those is the Melita pipeline, a project “wholly-owned by the Government of Malta” whose “mission is to connect Malta to the European Gas Network” and end the island’s energy isolation, according to its promoters.

The pipeline project is controversial because it will link to the Delimiara power station, which is part-owned by the man on trial for the killing of Maltese journalist Daphne Caruana Galiza with a car bomb in October 2017.

Caruana Galizia was investigating corruption allegations at the power station and the Electrogas deal involving Yorgen Fenech, who has been charged with conspiracy in her murder.

This is the same power station that the EU could be set to part-fund. Fenech, who is currently on trial, denies any part in the assassination.

But despite this, the Maltese government is still deeply attached to the completion of the project, arguing it is needed to end the island’s energy isolation and prepare for a greener future where fossil gas would be replaced by hydrogen and biomethane.

According to EU Parliament sources, the energy minister of Malta, Miriam Dalli, wrote to negotiators from the European Parliament and called them directly in an effort to persuade them about the need to support the Melita pipeline.

One letter obtained by EURACTIV is dated 7 December, one week before the fourth and final round of three-way negotiations on the TEN-E regulation involving representatitves of the European Parliament, EU member states and the European Commission.

In the letter, Dalli positions the Melita pipeline as a clean energy project because it would be hydrogen-ready: “We are committed to decarbonise our economy by 2050, and Malta wants to be given the opportunity to tap into clean energy sources. Having a hydrogen-ready pipeline is a decisive step forward to ensure that the country moves away from LNG to a cleaner source,” she wrote.

“If this project materialises, Malta would be given a fair chance at actually moving towards clean energy sources, opening up market options and deliver competition rather than favour any particular operator,” she concluded.

Alongside this, Malta’s permanent representation in Brussels – the country’s official EU delegation – also sent a fact sheet to lawmakers emphasising why they believe the pipeline should be completed.

The fact sheet, obtained by EURACTIV, carries the stamp of the Maltese Ministry for Energy, Enterprise and Sustainable Development and is headlined “Malta’s hydrogen-ready pipeline”.

It reads: “A hydrogen-ready pipeline, owned and operated by Interconnect Malta Ltd, gives the Island the opportunity to tap into clean energy sources, ending its physical isolation, contributing to the diversification of the energy mix and strengthening its security of supply.”

The derogation to the pipeline “gives Malta the realistic opportunity to tap into a clean fuel. Without it, Malta would have to keep the existing LNG fuel infrastructure and be locked into fossil fuels,” the fact sheet continues.

“Malta has moved away from Heavy Fuel Oil using the existing LNG system as an interim source of cleaner fuel. The next step to continue on the decarbonisation path is a permanent connection to the European grid to access clean energy.”

It is not unusual for EU countries to lobby decision-makers for a particular outcome in EU negotiations. But in this case, no other country than Malta tried influencing the Parliament.

Erik Bergkvist, a Swedish MEP who was one of the Parliament’s negotiators for the TEN-E regulation, said Malta was the only EU country that contacted him during the process.

“In my mailbox, if I remember correctly, there was a letter from Malta. I don’t think it has been from any other [EU country],” said Bergkvist, who is from the Socialists and Democrats (S&D) political group in the European Parliament.

“I haven’t felt any pressure, but I have felt that many are very interested in the result. They were very eager to inform me or try to persuade me to do certain things,” Bergkvist told EURACTIV.

“But after being in politics for 30 years, well, that’s part of it,” he added.

Fossil fuel and corruption

Contacted by EURACTIV, the Maltese energy ministry emphasised that the project was necessary to diversify the country’s energy mix and end Malta’s physical isolation.

“Without the pipeline, Malta would have to keep the existing LNG fuel infrastructure, be consequently locked into fossil fuels, and remain isolated from accessing this renewable gas emerging sector, putting the country and its citizens at a disadvantage,” it said.

The energy ministry also reiterated the argument that the pipeline is compatible with the EU’s long-term climate objectives.

“The design of the pipeline is currently being upgraded such that during its designed lifetime the pipeline would be able to transport blends of natural gas, biomethane, and hydrogen up to 100% Hydrogen,” the ministry told EURACTIV in emailed comments.

However, Malta’s position on the pipeline remains controversial for two reasons.

Firstly, many argue there is no further need for gas infrastructure in Europe and that there is no guarantee that hydrogen will ever flow through Melita once it is built. Consequently, there is a risk that the pipeline will further lock Malta and Europe into using climate-wrecking fossil fuel for many years to come.

Secondly, the Melita pipeline is linked to Electrogas, the company involved in the corruption case with Yorgen Fenech, who has been charged with conspiracy in the murder of Daphne Caruana Galizia.

Matthew Caruana Galizia, the son of the assassinated journalist, says his mother was murdered precisely because she was investigating corruption allegations at Electrogas, the company part-owned by Fenech.

“The murder is probably and unequivocally linked to this gas pipeline project because the only client of the pipeline is Electrogas. We have said over and over again that is what the motive of the murder appears to be,” Caruana Galizia told EURACTIV.

The fact that Malta is so invested in this deal is “inexplicable”, he added, noting that “the government, or rather the energy minister [Dalli] has thrown her entire political weight behind the project.”

Family of murdered journalist ask EU not to fund gas pipeline linked to suspect

The family of murdered Maltese journalist Daphne Caruana Galiza, as well as several EU lawmakers, has called on the EU not to fund a gas pipeline project between Malta and Sicily that will link to a power station part-owned by the man on trial for her killing.

The Melita gas pipeline has already received EU money and could now receive more following Wednesday’s deal on the TEN-E regulation.

Under the terms of the deal, Melita and the EastMed pipeline connecting Cyprus to mainland Greece will both remain eligible for EU funding and inclusion on the next list of EU priority energy projects.

However, they will not be eligible for funding beyond 2027 and project developers will have to present a roadmap specifying when the pipelines should become dedicated to transporting hydrogen, a gaseous fuel supported at EU level because it can help decarbonise heavy industry.

These roadmaps should aim for transporting hydrogen “by 2036 if market conditions allow,” according to a source familiar with the text agreed on Wednesday.

“The really most difficult question, and we spent quite a lot of time on it, was how to find a solution that will not lock us into fossil fuels,” said Bergkvist, who was happy about the inclusion of hydrogen in the agreement.

This was not the case of two other EU Parliament negotiators who were left frustrated by Wednesday’s deal.

“For me, the problem is twofold,” said Claudia Gamon, who represented the Parliament’s centrist Renew Europe political group during the talks.

“I don’t want to finance this Melita pipeline because I don’t think that we should reward murder in any way with EU funds, but I also generally don’t think that we should spend any money on new pipelines,” she told EURACTIV.

Marie Toussaint, a French Green MEP who also sat on the talks, was equally disgruntled. “This is a poor result – not only a missed opportunity, but a denial of the EU promises – to end up with fossil fuel subsidies, despite Glasgow and the acceleration of the climate crisis, despite our Green Deal and Climate law commitments,” she told EURACTIV.

According to Eilidh Robb, a campaigner at Friends of the Earth, it is “quite outrageous” that the two projects with the most public resistance ended up receiving EU backing.

“This seems to be a very political move to please Malta and Cyprus, and the pressure really came from the Council on this,” she added, saying countries that were skeptical about the project could not find good enough reasons to challenge the demands of Malta and Cyprus.

Energy security?

According to the text agreed on Wednesday, EU support aims to complete efforts to create a European gas network and end the energy isolation of Malta and Cyprus, a promise that was initially made in European Council conclusions adopted in 2011.

When asked by EURACTIV about the issues related to the Melita project, a European Commission spokesperson said: “Malta needs to end its energy isolation through integration into the trans-European gas network”.

But Matthew Caruana Galizia told EURACTIV the project has never been about energy security, saying the Maltese energy ministry never presented a reasoned argument to justify investing in gas rather than other energy sources.

“In fact, the Ministry has done the opposite of presenting arguments to justify funding for a gas pipeline to the exclusion of other sources or vectors of energy. It used public funding to commission a study on the feasibility of different options for achieving energy security, yet it is refusing to tell us what the study found,” he added.

EPP push for paragraph barring corrupt projects from EU funding

The corruption allegations surrounding the Melita pipeline were known to EU negotiators when they were meeting on Wednesday.

This is reflected in the conclusions of the negotiations, which includes a paragraph pushed by the European People’s Party (EPP), saying EU funding should not go to corrupt or illegal projects.

“Projects of common interest should not be eligible for Union financial assistance where the project promoters operators or investors are in one of the situations of exclusion referred to in Article 136 of the Financial Regulation, such as in case of conviction for fraud corruption or conduct related to a criminal organisation,” according to the paragraph added to the conclusions.

“Projects of common interest may be removed from the union list in accordance with the procedures set out in Article 3(4) if its inclusion in that list was based on incorrect information which was a determining factor for that inclusion or the project does not comply with union law,” the agreement continues.

Tom Berendsen, a lawmaker from the centre-right EPP told EURACTIV he pushed for the inclusion of the paragraph following concerns about the pipeline.

“I insisted throughout that criminals must not benefit in any way from this derogation. It is essential that the EU is able to ensure that no funds go to criminals and that this project is not abused to allow funding to go to criminals,” said Berendsen who represented the Parliament’s EPP delegation in the talks.

“I’m particularly happy that we managed to achieve this because it is not right that these fraudsters and criminals are rewarded with taxpayers’ money. EU governments benefitting from a derogation, like Malta, have to make sure that criminals do not directly or indirectly benefit from EU funds,” he told EURACTIV.

For those opposed to the pipeline, that wording is problematic however, because it allows the project to continue receiving EU funding until someone is officially convicted of wrongdoing.

Indeed, both Fenech and the other politicians involved in the case are yet to be convicted, and are thus not “criminals” in legal terms. This is despite the fact that Fenech is being charged and held in custody and the two other politicians having their actions well documented.

To critics, the wording of the agreement therefore opens a loophole to continue funding for the pipeline, as those involved in the case are not criminals at this stage.

Toussaint, the French Green MEP, said she was not convinced by the addition of the paragraph on corruption.

“Despite the first revelations from Daphne Caruana Galizia in 2017, and despite the existing law, Melita has been on two different projects of common interest lists and is now offered a derogation to get funding for many more years to come,” she told EURACTIV.

“The reminder is not convincing enough,” she said.

For Gamon, too, the addition of a paragraph on corruption is meaningless. “They said no money should go to projects or people that are involved with corruption. But that applies anyhow. I just think it’s strange that we would have to mention that, in a regulatory proposal” where laws apply by definition, she said.

“I don’t have that trust, and I don’t think anybody else should just have the trust,” she added.

To express their concerns, Gamon and Toussaint sent a letter to the Slovenian EU Council Presidency, which was overseeing the negotiations and represented the 27 EU member states in the talks. The Slovenian presidency replied that the TEN-E regulation only provides a legal framework for energy projects to receive EU funding while “the process of selection of projects is led by the European Commission”.

Moreover, not all MEPs involved in the talks were on the same line as Gamon and Toussaint. While the allegations against the Melita pipeline are serious, Bergkvist said it is not the Parliament’s role to decide on corruption cases.

“We are concerned but that’s not part of our negotiation,” he said. “When we negotiate, we foresee or we take for granted that everything that we approve of is legit.”

According to European Parliament sources, MEPs had to give a lot of ground to EU member states during this final and gruelling round of negotiation.

Whatever the final outcome, the long shadow of Daphne Caruana Galizia’s murder will continue to hang over the Melita pipeline.

[Edited by Alice Taylor and Frédéric Simon]

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