The Guyana Sugar Corporation yesterday signed a US$12M ($2.4B) contract with an Indian firm to upgrade the Enmore factory for packaged sugar within the next year in an effort to reduce the dependence on bulk sugar exports.
The Enmore factory is being considered for additional expansion to facilitate all of the sugar production in East Demerara, merging all the operations in that area into one.
Chief Executive of GuySuCo Errol Hanoman disclosed during the signing with Surendra Engineering that one of the essentials of the new project is to convert the entire production of East Demerara into direct consumption sugar for the local and international markets.
He referred to the project as being critical to GuySuCo’s turnaround plan, adding that that it is an important step in the company’s development.
The new project dubbed, ‘Project Gold’, is the first sugar project under the Guyana National Action Plan (GNAP). It will result in the conversion of the total sugar output of the Enmore factory, 40,000 tonnes, into high-quality branded direct consumption sugar for the retail trade. Currently, GuySuCo produces 8,000 tonnes of packaged sugar.
Agriculture Minister Robert Persaud placed the project within the context of the increasing threats facing the local industry saying that it is both timely and necessary. The minister said also that the EU is funding the project as part of the accompanying measures for the GNAP. He referred to it as a significant injection in the industry, which he classified as a new industry given that they are rebuilding it. Recently the head of the EU Delegation here disclosed that Guyana had lost 6 million Euros in support for the industry as the government had been tardy in delivering a plan.
Persaud yesterday pointed to the European Union price cuts and the end of the European Union sugar protocol, stressing the need for diversification.
He said the project forms part of the strategic (diversifying) vision of the industry by placing emphasis on value adding, and by developing a sugar cane cluster. Persaud also cited the need to reduce the dependence on bulk sugar exports.
According to Persaud, the focus is now on income and revenue for the industry. He said the new Enmore factory when upgraded can produce as much as 80,000 tonnes at full capacity in the future provided all the various ingredients are there including an adequate supply of sugarcane.
As part of the plans to consolidate the East Demerara sugar estates, he said, a critical eye would be kept on sugar cane cultivation, noting that a sufficient supply is simply not there right now.
Further, he pointed to job creation to flow from the new project while declaring that this new project represents “full confidence in the future of sugar”. He said too that critics of the industry have pointed to gloom in the industry when “there is a viable turnaround plan in place”.
Persaud said also that Surendra Engineering, is reputable but more importantly, it has promised to complete the project in time for its September 2010 opening. He said penalties are attached to the contract in the event of a delay in the startup. The government experienced enormous delays with the Chinese contractor for the new Skeldon factory.
Chairman of GuySuCo’s board Dr Nanda Gopaul spoke briefly during the signing. He said GuySuCo would be able to benefit from better pricing and that the project also has enormous potential at Enmore, adding that they can later move to co-generation.
Gopaul stated further that the project aims at increasing efficiency in the industry while focusing on greater returns for local sugar.
