Issue link: https://maltatoday.uberflip.com/i/682623
maltatoday, SUNDAY, 22 MAY 2016 4 News CONTINUES FROM PAGE 1 The origi- nal negotiators included the deputy prime minister Louis Grech and Chairman Maria Micallef. But yes- terday senior reps from the tourism industry said that the negotiators were not safeguarding the interests of Air Malta. Attempts to contact Maria Micallef proved futile. Montezemolo's most worrying comment was about the advantages the Air Malta stake would offer to Alitalia in Sicily, which proved that Alitalia's strategic vision for a feeder airline does not match Air Malta's expectations of expanding its routes to transcontinental hubs. Montezemolo, 68, a former chair- man of Ferrari and Fiat, said this week at a convention for Alitalia that Air Malta would not cost a euro in terms of investment. "If it goes forward, it would be a zero-risk operation – sub-zero, in- deed – for Alitalia. It is an invest- ment that would not cost a euro, and would open up interesting con- nections with Sicily. Let us work on it, let's carry out a management and economic due diligence." Montezemolo's comments are sparking a debate as to whether any investment for the Air Malta acqui- sition will be carried out directly by Etihad. Alitalia forms part of the satellite of airlines owned by Abu Dhabi based airline Etihad Airways, which has been in advanced talks with the government over an equity invest- ment in Air Malta since November 2015, as revealed by MaltaToday. He continued: "We spoke about it yesterday during an interesting board meeting. We'll be looking at it in the summer, maybe by end-June, and we'll be able to take a decision." Alitalia's potential acquisition would definitely lead to downsiz- ing in the national airline, which is the reason the small airline has been losing out to low cost airlines such as Ryanair which this year will sur- pass Air Malta in terms of passen- ger arrivals at Malta International Airport. The Malta Hotels and Restau- rants Association has expressed concern over remarks by the Alitalia president, saying Mon- tezemolo's comments prejudiced the value of the memorandum of understanding signed with the Maltese government. "At this stage MHRA questions which process was adopted by government that led to choosing Alitalia as the preferred potential strategic partner for Air Malta over other airlines or solutions presented and reviewed. What is at stake is nothing short of the most important conduit for our econo- my. Any mistakes on the matter of Air Malta will definitely have seri- ous and irreparable consequences on the economy," the MHRA said, whose president is hotelier Antho- ny Zahra. The MHRA said that giving Air Malta for 'zero euro' as suggested by Montezemolo raised serious doubts on the strategic partner- ship and demanded that tourism minister Edward Zammit Lewis take note of the remarks. Etihad, the No. 3 airline in the Persian Gulf, bought minority stakes in seven carriers from Aus- tralia to Europe to funnel passen- gers through its Abu Dhabi hub and share costs, and it has formed the aviation-group parent compa- ny as part of the process. Alitalia plans to invest €400 mil- lion in its business this year and is evaluating options to add more long-haul aircraft to its 98 narrow- body and 24 wide-body planes, according to a presentation on Wednesday. Of the total, €240 million will pay for fleet expansion and cabin interior refurbishment, Alitalia CEO Cramer Ball said. Expression of Interest: Call for the Internationalisation Partnership Awards Scheme is now open The Malta Council for Science and Technology is inviting applications for the submission of project proposals under the Internationalisation Partnership Awards Scheme 2016. The Internationalisation Partnership Awards Scheme will fund activities which aim to foster mutually benecial international relationships between local R&I-performing academic or private entities and foreign counterparts based in the EU. Interested applicants are asked to submit their application form electronically to mark.c.farrugia@gov.mt with "Internationalisation Partnership Awards Scheme Application" as a subject by noon on the 15th July 2016. Additional information may be found on the Council's website under the news section. The Malta Council For Science And Technology, Villa Bighi, Kalkara KKR 1320, Malta www.mcst.gov.mt Mistakes on Air Malta 'damaging' BWSC conversion to natural gas will take 12 months MIRIAM DALLI THE full conversion to gas of the D3 plant – better known as the BWSC plant – will take 12 months, informed sources have told Malta- Today. Whilst Enemalta has failed to pro- vide a timeframe in reply to ques- tions by this newspaper, the energy supplier confirmed that only four engines will initially be converted to Wärtsilä 50DF dual fuel. This, it added, would provide the engines flexibility to run on gasoil. "Once the re-build of these four engines is completed, the other four engines will be converted to natural gas as well. The two-stage approach is being adopted to ensure that Ene- malta retains the necessary flexibili- ty and security of supply to meet the country's electricity requirements," a spokesperson for Enemalta said. The D3 power plant was sold to Chinese-state owned company Shanghai Electric Power for €150 million, with an additional invest- ment of €70 million to convert it to gas. News of the initiation of works for the conversion of the D3 plant was given by Prime Minister Joseph Muscat on Sunday while addressing a political activity. Muscat said that the use of heavy fuel oil was gradu- ally being phased out and replaced by gas. The Electrogas power plant, a 200MW plant running on LNG, is expected to be up and running by summer, according to minister Konrad Mizzi, but the plant has al- ready missed a June 2016 deadline – a second missed deadline. Enemalta plc is coordinating the complete elimination of heavy fuel oil (HFO) from the electricity gen- eration mix. The new mix will be based on gas-fired plants, the Mal- ta-Italy Interconnector and renew- able energy sources. A recent report from Standard & Poor's has also noted that Mal- ta's power demand will be "partly sourced" from the interconnector with "the remainder" being ac- quired from Electrogas's natural gas plant and SEP's D3 plant. Works on the conversion of the existing HFO-fired D3 plant start- ed in 2014 and involves "extensive changes" to the existing Wärtsilä 18V46 diesel engines as well as oth- er related installations. "All engines will be converted to run on natural gas in two stages," Enemalta said, having now finalised plans, safety reports and contract- ing. D3 Power Generation Com- pany Ltd – where Enemalta holds a 10% shareholding, the rest held by Shanghai Power Electric – also consulted Enemalta's capacity and planning dispatch section to finalise the isolation and conversion sched- ules. Enemalta said that the conver- sion of each engine was a complex process involving the removal of all cylinder heads and cylinder liners, re-boring the engine block to ac- commodate the wider diameter of the new pistons, modification of the turbo chargers and refitting the en- gine with new pistons and cylinder heads. The existing mechanical fuel sup- ply control system would need to be replaced with a plc-ignition control system to suit the requirements of the new fuel. All HFO fuel pipes and pumps would also need to be replaced with appropriate natural gas infrastruc- ture. Finally, the engine compartment will be upgraded to introduce all necessary safety measures, whilst the emissions abatement system will be modified to suit the require- ments of the new fuel and to do away with equipment specifically related to the use of HFO. "The D3 plant will be supplied from the new LNG regasification facilities currently being developed by Electrogas Malta Ltd," Enemalta said. 'All engines will be converted to run on natural gas in two stages'