General Manager of Bosai Minerals George Zhoa says that since the start of the Linden protest on July 18, the company has not been producing bauxite and it fears that it could lose markets as customers are concerned.
In a brief interview with Stabroek News, Zhoa said that since the Linden protests began, the company has curtailed its activities and is only maintaining its equipment.
On July 18, Lindeners began a protest against a hike in electricity tariffs and this later escalated after three protestors were fatally shot and about 20 others injured, after police opened fire on protestors. The unrest has continued since and roads into and out of the mining town are blocked. The authorities and other stakeholders have been voicing their concern about the economic toll of the continuing blocking of roads.
Zhoa said yesterday that a “Japanese ship” is expected soon to take a shipment of bauxite out. He denied reports that the company is pulling out of Guyana but said that there is concern with regards to meeting commitments to markets. “It is not true. We are going to stay here,” he said. “For three weeks we had no operation except for maintenance. Customers are very concerned. Everybody wants stable supply. We would lose markets,” he added.
Asked about the provision of electricity to Linden, Zhoa said that Bosai produces the power and it is the government that distributes it to the communities. In an earlier interview, he had said that the cost of electricity that is sold to the community is calculated based on the company’s use of diesel to generate electricity as against the less expensive heavy fuel oil. He noted that Bosai gets its fuel, duty free.
Observers have said that they believe Bosai’s cost of electricity is too high given the fact that the fuel is duty free. Chartered Accountant Christopher Ram believes it is worthy to know what goes into the costs and whether overhead costs are included in the charges to Linden Electricity Company Inc (LECI).
Bosai has said that billing is done in compliance with the Power Sale and Purchase Agreement between Bosai Minerals, LECI and the government. However, it has not provided detailed costs for power sold to LECI. The company had said that after operating at a loss in 2009, the Bosai Power Plant recorded profits over the last two years for power generation to Linden, which has received on average, double the supply used by the company, according to Bosai.
Stakeholders, including the AFC, have called for Bosai to be held accountable for the government’s decision to roll back the electricity subsidy in Linden, resulting in the proposed higher tariffs. That party, contending that the electricity is produced “principally” for Bosai’s use, said that since the company buys fuel free of duty, its cost of production should be far lower than the Guyana Power and Light which serves coastal Guyana.
The AFC also accused Bosai of taking advantage of its freedom from regulation by charging “an exorbitant” rate for the surplus electricity it sells.
The Private Sector Commission, the Indian Arrival Committee, the Guyana Gold and Diamond Miners Association, among others, have called for the situation in Linden to be resolved. The government and other stakeholders have also expressed concern about the economic toll of the continued barricading of Linden roads which serves the gold mining interior regions.
