EU agrees to funding but warns of exclusion for entities ‘related to crime’

European ministers have agreed to allow Malta to apply for crucial European funding that will subsidise at least half of a €400 million gas pipleline investment to Sicily.

But they also said that entities connected to fraud, corruption or conduct related to criminal organisations will be excluded from such funding, a possible reference to the presence of Electrogas as owner of Malta’s gas plant.

Electrogas includes Tumas magnate Yorgen Fenech, the alleged mastermind in the Caruana Galizia assassination, as a shareholder.

The Caruana Galizia family has called on the EU to deny such funds for a pipeline, that would trigger a gas exit price from the Maltese government to Electrogas, which procures LNG; as well operating the gas plant that converts the gas into electricity and is then sold on to state utility company Enemalta.

After first being refused funding when the European Commission advanced Green New Deal objectives to phase out fossil fuels, Malta obtained a derogation that has now resulted in a decision by Council ministers to allow interconnection funding.

Both MEPs and the Council agreed yesterday that in the case of Cyprus and Malta, that are still not interconnected to the trans-European gas network, will be allowed one interconnection per state under development or planning, that has been granted the ‘Project of Common Interest’ (PCI) status and is necessary to secure permanent interconnection to the trans-European gas network.

They also added an “explicit reference” to article 136 of the EU financial regulation, that enumerates the situations where a person or entity shall be excluded from being selected for receiving EU financing, such as fraud, corruption or conduct related to criminal organisations.

The Council on Tuesday also decided to end support for new natural gas and oil projects and introduce mandatory sustainability criteria for all projects. This is part of a move to allow, during a transitional period until 31 December 2029, for dedicated hydrogen assets converted from natural gas to be used to transport or store a pre-defined blend of hydrogen with natural gas or biomethane.

The revised TEN-E Regulation updates the infrastructure categories eligible for funding, with an emphasis on decarbonisation, offshore electricity grids, hydrogen infrastructure and smart grids.

The PCIs are eligible for financing from the Connecting Europe Facility for 2021-2027.