Legal complexities no barrier to power plant

Developers stand by 21⁄ year time frame, writes Jenny Keown.

Developers of a $60 million Bay of Plenty geothermal plant are confident it will be built, despite a Maori Land Court investigation and revelations a director of the venture is a convicted fraudster.

Te Ahi O Maui, the joint venture company developing the power plant, was formed in August 2010 by Gisbornebased energy and logistics company Eastland Group (owned by Eastland Community Trust), the Kawerau A8D Ahu Whenua Trust and Hawaii-based Innovations Development Group (IDG).

Te Ahi O Maui’s directors include Eastland’s chief executive Matt Todd, IDG’S founder Roberta Cabral, Lee Erwin of IDG, and Kania Hunia of A8D, according to the Companies Office.

The group aims to build a 12-15 megawatt power station on land owned by the Kawerau trust near Lake Rotorua within 2 years, said Todd.

‘‘Millions of dollars’’ have been spent on the project so far, he said. It had approval from the Overseas Investment Office, and there was agreement with most of the landowners about where the station would be built.

It was moving towards a ‘‘final investment date’’ at which point the decision would be taken to pour large investment into the project, said Todd.

He dismissed concerns about Cabral’s criminal conviction, saying Eastland had a normal commercial relationship with IDG and was told of Cabral’s background before entering in to the joint venture.

In 2002 Cabral was sentenced by the Hawaii District Court to 10 months in prison and three years’ probation for wire fraud and aiding and abetting wire fraud.

IDG said Cabral wasn’t an ‘‘active’’ director of Te Ahi O Maui.

Todd conceded the Maori Land Court investigation had added unnecessary complexity to the project, but said it hadn’t been materially affected.

‘‘The vast majority of the beneficial landowners understand that the way to create value from this project is to help it move forward,’’ said Todd.

Two A8D trustees are under investigation by the Maori Land Court for allegedly misusing trust funds.

The court action began in December 2010 when Judge Layne Harvey issued an order restraining trustees Colleen Skerett-white and Tomairangi Fox from acting on trust business without court permission.

Kania Hunia said his fellow trustees have been accused of paying themselves out of trust funds without court approval, though both deny the allegations.

In April last year the judge appointed independent trustee Andrew Kusabs to the trust, and in October the court ordered the removal of Skerett-white as a trustee on the grounds she had been declared bankrupt. Proceedings were adjourned to March this year.

In a statement to the court last year Skerett-white alleged Eastland had paid $2m to IDG for the right to participate in the project while the trust got an annual rental income of only $200,000. IDG denied it received $2m from Eastland.