Albanian Officials Sued for Loss-Making Energy Deal

The energy minister and state attorney are being sued over an agreement to resolve a dispute they signed with power giant CEZ which allegedly cost the state 479 million euro.

The Albanian Supreme State Audit, KLSH, said on Wednesday that it was suing energy minister Damian Gjiknuri and state attorney Alma Hicka over the agreement with CEZ, which used to administrate energy distribution in Albania and is 70 per cent owned by the Czech government.

The auditors’ report concluded that the 479 million euro loss was incurred because the energy minister and the state attorney took the decision to negotiate an amicable agreement when resolving a dispute between Albania and CEZ, instead of using international arbitration.
 
“The economic damage created to the Albanian state is 479 million euro: 95 million euros as fee for negotiation of the agreement; 352 million euro as financial liability coming from mismanagement of this company in 2009-2012 timeframe; 32 million euro from the depreciation of 24 per cent of state shares,” the auditors’ report said.

During a heated debate on the issue in parliament on Thursday, Gjiknuri denied the audit report’s allegation and insisted it was politically inspired.

He alleged that former Prime Minister Sali Berisha was behind the report because the head of KLSH was appointed during the time that Berisha was in office.

“That report is worth nothing, no penal charges can emerge out of it,” Gjiknuri said.

“I just wonder how it is possible that the report has similar conclusions and accusations to the ones that Berisha made a year ago when the government signed the agreement with CEZ Company,” he added.

The agreement was signed in June 2014 between the Albanian government and CEZ.

Gjiknuri has previously described it as the best that Albania could get because international arbitration with CEZ could have blocked foreign investment in the country’s energy sector.

Opposition MPs in parliament to officially called for an international investigation into the CEZ affair, but the idea was rejected by the ruling coalition.

CEZ bought 76 per cent of the shares in the Albanian energy distribution company in 2008.

In January 2013, the Albanian Energy Regulation Authority revoked CEZ’s licence, saying that the company didn’t fulfil the initial contract with Albanian state, mismanaging the distribution of energy.

In June 2014, after negotiations led by Gjiknuri, the government decided to make an amicable agreement with CEZ to resolve the dispute, although the opposition was against the move.

By Fatjona Mejdini