Sugar output still dismal, Skeldon far below target

With its sugar output continuing to be far below expectation, the Skeldon sugar factory is preparing for the conversion of the current hydraulic dump system to an electric winch system which will help it get closer to its 350 tonnes per hour crushing potential originally promised under the China National Tech-nical Import and Export Corporation (CNTIC) construction contract.

When Guyana Sugar Corporation (GuySuCo) officials appeared before the National Assembly’s Economic Services Com-mittee recently, Technical Services Manager Yusuf Abdul had noted that to fix the ill-performing punt dump could cost US$4 million. Significant controversy has surrounded this figure as the rehabilitation of the punt dump was one of six projects that was supposed to be done by the South African firm Bosch Engineering.

Stabroek News had been reliably informed that the cost of the Bosch rehabilitation would be approximately US$30 million. However, in March, GuySuCo refuted this figure and said the total repairs cost US$1.8 million.

The US$110 million Skeldon sugar factory has consistently given problems since it was commissioned in 2009. More money was subsequently spent to help realize the full potential of the factory, the lynchpin of the Skeldon Sugar Moderniza-tion Project (SSMP). Five years later, it is still nowhere near delivering on its projected target of 110,000 tonnes of sugar per annum.

In addition to the conversion of the hydraulic dump to a winch-based system which was being pushed by factory management up to last August when Stabroek News visited the estate, Skeldon is also considering bringing the feeding system from the old factory into the new factory. This publication was made to understand that local contractors who were solicited for the job estimated that it could cost up to $40 million or more to bring over the components.

At this stage, GuySuCo will not be proceeding with this particular project. The fact that the new state-of-the-art factory would even consider bringing over components from the old factory only further highlights the inadequate job that was done by CNTIC, observers say.

The dumping system was further assisted for this crop as a result of the replacement of four new cylinders to the outboard dumper as well as valves maintenance and replacements. According to a source, the factory has seen extensive work in 2013-2014 that has been far more consistent than in previous years. Stabroek News was told that “a lot of work is going on, a lot of needed and necessary work.”

With that said, however, Skeldon’s numbers remain troubling up to last week. The factory has only managed to produce a little over 10,700 tonnes of sugar out of its 27,000 tonnes second crop target. GuySuCo is expected to continue grinding until the beginning of December which leaves six to seven weeks of the season left to reach this goal. For the last crop, a decision was made to keep the factory grinding to achieve its 13,795 tonne target. At times, the multimillion dollar factory was kept operational to grind just seven tonnes of sugar in the day.

For the year, Skeldon has produced under 25,000 tonnes of sugar. With an annual revised target of 41,000 tonnes, the estate is a far cry from achieving the goal of the 2013-2017 Strategic Plan which stated that for 2014, Skeldon should be producing 57,915 tonnes of sugar annually. Originally Skeldon was supposed to be produced 110,000 tonnes annually.

The recent Skeldon workers’ strike also put a significant wrench in the grinding process. Prior to the strike action – caused by an altercation between a worker and the estate manager – the factory was meeting its weekly targets. However, the factory has been forced to play catch-up as a result of the strike.

For days after the strike which began on September 20 and ended five days later, the factory was recording an incredibly high tonne of cane required to produce a tonne of sugar ratio of 33. This newspaper was told that this high ratio TC/TS has normalized to 13.7, but prior to the strike this figure was more in line with the industry average of 13 TC/TS.

Under the current contract for 167,000 tonnes with Tate and Lyle, the state-owned company makes roughly US$490-550 per tonne. The factory is currently being managed by one of the former Enmore factory managers from India and this newspaper was told that American Sugar Holdings, owners of Tate and Lyle Sugars, contractually sends persons to manage components of the estate and, currently, the co-generation plant manager was under contract and would be leaving in December.

Overall, sugar production for 2014 was 164,808 tonnes up to October 20 and the second crop figure was 84,813 tonnes. The 2014 annual target was revised to 216,000 tonnes by GuySuCo but according to the Strategic Plan, production should have been set at 278,752 tonnes of sugar for the year.

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