MoU with T&T company aims at sugar processing at Skeldon

The APNU+AFC government quietly signed a Memorandum of Understanding (MoU) on December 8, 2016 with a Trinidadian company to look at the possibility of setting up a sugarcane processing facility at the Skeldon Sugar Estate.

The MoU was signed through the Guyana Office for Investment (Go-Invest) with D Rampersad and Company Limited (DRCL) to conduct a feasibility study “for an integrated sugar processing facility for GuySuCo’s assets and related assets in Skeldon, Guyana.”

This came as a surprise to many, even though Chairman of the Guyana Sugar Corporation (GuySuCo) Board, Dr Clive Thomas had told Stabroek News that due to the expenses it is incurring, the company was looking at the option of selling or diversifying the estate.

He had also told this newspaper in an interview that they had already spoken to potential buyers and were awaiting the go ahead from government to continue the discussions.

According to the MoU seen by this newspaper, Go-Invest would facilitate meetings and discussions with DCRL and identified Government of Guyana [GoG] ministers and agencies.

The company’s objectives under the MoU include; the cultivation and harvesting of sugarcane, sugarcane processing, production of fuel grade ethanol, production of bulk rum for local, regional and international markets, power production from bagasse, production of high test molasses, construction of a liquid bulk terminal and the development of a solar power generation facility.

Another objective of the company is: “To receive the requisite data and information support from Go-Invest and the relevant ministries and agencies in Guyana that will facilitate an effective assessment of the opportunities and factors that are relevant to the preparation of a definitive project proposal to the GoG.”

According to Thomas, selling the estate is one of the options the Board has but its members have also made other proposals to Cabinet and are awaiting a decision.

Without divulging further information in relation to diversification, he had said: “Basically what we are trying to do is to diversify to consolidate the production of sugar,” for the higher-priced local, Caricom and US markets.

The next step, he said, “Would be to go for value-added sugar and also to try to establish and convince the rest of the Caribbean that we should be the sole producer of refined sugar. In that case we would set up a refinery. Those are the primary thoughts at this time.”

Stabroek News contacted the Director of DRCL, Avinash Rampersad on the MoU and he responded that he would “be in Guyana soon with my attorney and I will get him to give you a call and he can answer any question that you may have.”

He made it clear that “All we have done here is sign a MoU with Go-Invest… Legally, it’s a non-binding agreement… All that we are looking at is the possibilities in diversifying the sugar and renewable industry.”

Checks on the company’s Facebook page showed that it specializes in mechanical engineering services. It is also “very active in supporting the Construction Industry in terms of installing, setting, aligning, pre-commissioning and commissioning of fixed and rotating mechanical plant.”

While the page did not mention any experience with any agricultural enterprise, Rampersad added: “What I can say in terms of experience [is] that we have reached out to quite a number of people who are involved in the sugar and renewable industry and these are the people we would be relying upon, should this project move forward.”

He also told this newspaper that “any other information that you require, it would be in your best interest to contact Go-Invest or the Government of Guyana who would be able to release any further information…”

He said his company is exploring opportunities not only in Guyana, but in other parts of the Caribbean.

Asked whether DRCL has partnered with Auto Fashion Store, located at Garnett St., Campbellville, he responded that the owner, Noel Rupie Shewjattan who signed as a witness, was his “local representative.”

According to the MoU, the company has recognized that the sugar industry in Guyana has been pivotal to the “economy of Guyana, in which regard DRCL embraces the opportunity to regenerate the industry” through the proposed project.

It stated too, “The generation of renewable power and manufacture of transportation fuel can be a key component of any alternative options for Guyana and is consistent with GoG’s renewable considerations.”

 

Expectations

The MoU stated that if an agreement is entered, some of the expectations of the DRCL include, access to key infrastructure, favourable combination of tax incentives, lands for sugarcane cultivation and infrastructure, guarantees on minimum product take off by the GoG in respect to electrical power and fuel ethanol and power export provisions if applicable.

Government made no disclosure to the Guyanese public or issued any public notice or tender, prior to the signing of the MoU.

At a post-cabinet press briefing yesterday, acting Minister of Natural Resources, Raphael Trotman, when asked about the “secret deal” between the government and DRCL, responded that “there was no such thing as a secret deal.”

He added: “This matter has been shared with the Parliamentary Opposition, with GuySuCo, [and] with the unions representing workers at GuySuCo. It is not true to say there was anything hidden.”

According to him, government is not aware that to enter a MoU, that members of the opposition had to witness it.

He had no doubt that the Ministry of Business would not object to the document being released and that “there is no confidentiality clause to it.”

He also quoted a section of the MoU, which stated that the “parties agreed that this MoU constitutes a strategic liaison between DRCL and Go-Invest, intended to formulate and facilitate the development of a feasibility study for an integrated sugarcane

processing facility for GuySuCo’s assets and related assets in Skeldon, Guyana.”

The minister said too: “The mischief about a takeover is just what it is, mischief; false and should not be repeated and peddled… There is nothing here to sign the assets away but it is just meant to conduct a study.”

 

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