The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Key advisers to the group at the centre of the Renward Wells’ Letter of Intent (LOI) controversy have admitted arranging a meeting with Prime Minister Perry Christie where they “spent quite a long time” discussing its waste-to-energy project.

Both Algernon Allen, the Urban Renewal Commission co-chair, and businessman Frank Forbes, conceded in legal documents that they arranged the October 2013 meeting with Mr Christie as they “diligently pursued” the approval sought by Stellar Energy.

The duo, in defences filed to Stellar’s claim for claim for $727.364 million in damages against themselves, Mr Wells and the Government, largely denied - and sought to dismiss - the waste-to-energy group’s allegations.

However, Messrs Allen and Forbes made some notable admissions, not least concerning Stellar’s claim regarding the duo’s meeting with Mr Christie to push the merits of their now-$400 million waste-to-energy project proposed for the New Providence landfill.

“Around the end of October 2013, the fourth and fifth defendants [Messrs Allen and Forbes] arranged a meeting with Prime Minister Perry Gladstone Christie,” Stellar’s statement of claim alleged in paragraph 58.

“The Prime Minister advised the plaintiffs that he could not speak with them in any detail since the plaintiffs [Stellar] were still a part of the Bahamas energy reform RFP ‘in order not to contaminate the process’.

“Notwithstanding this, the Prime Minister spent quite a long time with [Messrs Allen and Forbes] discussing the plaintiff’s project. Subsequently, [Messrs Allen and Forbes] informed the plaintiffs: ‘We hold the key of the kingdom’.”

In their separate defences, both Messrs Forbes and Allen only denied that they said ‘we hold the key of the kingdom’. Both admitted the rest of those allegations, and said they “diligently pursued the approval” sought by Stellar for its waste-to-energy project in their capacity as the group’s advisers.

Messrs Forbes and Allen also admitted that the latter wrote to Mr Wells, in his capacity as co-head of the Government’s Energy Task Force, on December 6, 2013, and that the then-parliamentary secretary gave “an encouraging reply’.

The duo then confirmed that they “sought to secure sufficient funding for the anticipated costs associated with negotiations required to obtain the approval of the Government of the Bahamas’.

This was a direct response to Stellar’s claim that Mr Allen had presented it with an invoice for $100,000, a claim that the group “considered as an attempt of extortion”.

Both Messrs Allen and Forbes refuted the extortion claim in their defences, which were filed on November 17, 2016, and the $100,000 invoice - according to Stellar’s statement of claim - was waived.

The duo’s defences are likely similar because they worked together in relation to Stellar and now have the same attorney, Lockhart & Company and Damian Gomez QC, the former minister of state for legal affairs, acting for them.

Yet the defences raise more questions, and provide few answers, over the machinations within the Christie administration at the highest levels in the run-up to the July 2014 ‘leaking’ of the LOI, which subsequently led to Mr Wells’s departure three months later.

The controversy has yet to disappear or die, and continues to return to haunt the Government at regular intervals, largely because none of the parties involved has provided a convincing explanation to the Bahamian people of what happened and why.

Both Messrs Allen and Forbes, for instance, neither admitted nor denied Stellar’s claim that it was advised by the latter that the Prime Minister would arrange a $40 million government guarantee to support its engineering studies at the New Providence landfill.

The same paragraph also alleged that Mr Forbes caused Michael Halkitis, minister of state for finance, to write to the Inter-American Development Bank (IDB) seeking its support in arranging the $40 million guarantee.

Attached to this letter was a copy of the now-infamous LOI, with Deputy Prime Minister Philip Davis, not Mr Wells, named as the purported signatory on the Government’s behalf.

That letter to the IDB was sent on May 26, 2014, more than a month before Mr Wells signed it and the subsequent LOI ‘leaking’, proving that the document’s existence - and intention to sign it - was known at Cabinet level, and that the ensuing controversy was politically manufactured.

Both Messrs Allen and Forbes, in their defences, alleged that Stellar needed an LOI to show potential investors and financiers that its project was for real, thereby enabling it to obtain the necessary funding.

The duo, in turn, said Stellar’s inability to do this meant it “failed to satisfy the Government of the Bahamas that they had the resources to justify being granted the approval sought.

Stellar, which is headed by Dr Fabrizio Zanaboni and Jean-Paul ( JP) Michielsen, is alleging that the Government, and Messrs Forbes and Allen, prevented and “frustrated” it from fulfilling the terms of the LOI.

Apart from the damages, it is seeking Supreme Court declarations that the Government both “honour” the LOI contract and not award a waste-to-energy contract to any other company until damages are paid.

Elsewhere, both Messrs Allen and Forbes vehemently denied Stellar’s claim that they held themselves out as “agents acting” on the Government’s behalf in facilitating the proposed waste-to-energy plant deal.

Instead, the duo argued that they “acted professionally for the principals of [Stellar] in circumstances which clearly indicated” they were not representatives or agents of the Government.

Messrs Forbes and Allen also denied giving the group “any assurance” regarding the LOI and the likelihood of the Government executing that and other documents, and refuted claims that each recommended the other be appointed to Stellar’s Board of Directors.

Both described the other as being a shareholder and director of Stellar, which they said was key to combating the Government’s policy that waste management and collection was restricted to Bahamian-owned businesses only.