Parliamentary Secretary Reward Wells has created a “financial nightmare” for hard working Bahamian taxpayers and the government; this according to Opposition Leader Dr. Hubert Minnis who charged that the Letter of Intent (LOI) signed to Stellar and Waste Energy binds the government to financial penalties that would exceed $40 million.
Dr. Minnis issued a purported copy of that document to reporters during a press conference on Wednesday afternoon noting that clause eight of the LOI stipulates that each party will bear their own expenses; opportunity costs incurred – if any – and will indemnify the other party from any claims.
He added that a close review of the clause showed that it requires the government to indemnify the private developers under certain conditions without specifying a limit which Dr. Minnis maintains could possibly amount to millions of dollars.
“If the projects proceeds and the developer comply but the government breaks the deal, then the government is liable to pay compensation,” he said.
“In such a case, where the project proceeds but government approval is not granted, the government by this document may have incurred a contingent liability of up to the amount of the borrowing by the developer if the government fails to approve the signing of a power purchase agreement by Bahamas Electricity Corporation (BEC.) On its face, once the developer proceeds there appears to be a binding agreement which could tie the hands of the government. Moreover if the money was burrowed from a source outside The Bahamas, the government could find itself fighting a legal battle in a foreign the court, where punitive damages could be assessed far in excess of the $40 million that Stellar may have burrowed.”
Dr. Minnis added that Stellar Waste to Energy along with its partner is foreshadowed to borrow up to $40 million prior to engaging in Front End Loader Studies (FELS).
Once the studies are completed, BEC is expected to enter into a Power Purchasing Agreement (PPA) with Stellar Waste to Energy which will be the basis for further burrowing of up to $650 million to fully fund the project.
Overall the FNM renewed its call for Mr. Wells to be fired.
“Wells has clearly acted without authority, all hard working Bahamian taxpayers will pay for this egregious act if the government does not move quickly,” he said.
“The Bahamians people are right to have the deepest suspicions about the apparent lack of integrity in and accountability of those persons who hold highest offices in this Christie government.”
The party has also demanded a formal statement from the attorney general on the issue and transparency from the Christie Administration so that potential investors will be assured that their competitor will not receive unfair advantages.
The Opposition is also calling for a formal rejection of the letter of intent by the National Economic Council and full Cabinet without penalty to the treasury and taxpayers.
If the government fails to meet these demands, the FNM says it will push for a general election and the resignation of the government.
