THE Guyana Sugar Corporation has cleared the air on a number of issues regarding the Skeldon Sugar Factory, in response to statements emanating from the Alliance for Change, which made insinuations about the management of the facility.
The company’s top officials insist that the company continues to be managed by Guysuco’s personnel. CEO Paul Bhim was among those addressing the AFC statements.
“The Chinese are there and we have a technical service agreement with the Chinese which runs until June, 2012. They provide about 12 engineers supervised by GuySuCo personnel. Our people are working along with the Chinese engineers in order for them to obtain training. This will continue until June of next year,” Bhim said.
“We do anticipate that by the end of June, most of the staff would be up to speed. The Chinese have given us an option of actually carrying on for another six months after June of 2012. So if we feel we need further assistance on a technical level, we will certainly consider that,” Bhim said.
Addressing the matter at a press conference at the company’s boardroom at Ogle, were CEO Paul Bhim, Deputy CEO Rajaindra Singh, General Manager – Agriculture Services Raymond Sangster and General Manager – Technical Services Yusuf Abdul.
“This press conference has been called in response to a statement released by the Alliance for Change this afternoon, entitled ‘Let the sunshine prevail in Skeldon Factory deal’. Let me say right up front that a number of proposals were received from various entities for the management of the Skeldon sugar factory, in addition to financing to fix some of the problems we have been having with the factory. These proposals have all been assessed by the Board of Directors. We have not taken up any of those offers,” said Bhim.
The CEO said that back in March of 2011, there was a study of the factory done by a South African company called Bosch Engineering. “They came up with a proposal to fix the factory in the short term, with most of the work being done by GuySuCo personnel, with supervision by Bosch Engineering. They made a number of recommendations, some of which have already been implemented, with the others being implemented at the next out of crop period – December/January, 2012 and probably into the end of June, 2012,” he said.
He explained that Bosch Engineering Company is very familiar with the technology that the Skeldon factory is using.
Responding to productivity questions regarding Skeldon, Bhim said that the factory commenced grinding for the second crop on August 2, 2011.
“We have actually produced about 7,500 tonnes of sugar as of today. It has given us a few problems. It has not been free of trouble. But it showed that there was quite a huge improvement from what obtained during the first crop of 2010. The crushing rate, which is the throughput, has gone up significantly, to about 245 tonnes of cane per hour. The recovery, or tonnes cane to tonnes sugar ratio, has come down for the first crop in 2011,” he said.
He said that added to these improvements, the weather has shown improvement at Skeldon and this has allowed a consistent cane supply to the factory.

Skeldon defects

Speaking on the nature of some of the outstanding 12 defects at the Skeldon factory, Abdul said they are minor defects which are not expected to significantly affect operation.
“Most of the defects are in the co-generation plant, with the integration between the turbine and the Wartsila plant. At the moment, they are being operated separately, but the design [envisages] an integration [of the two],” Abdul said. “We are actually working with Wartsila and the contractor to get these minor defects corrected,” he said.
“[We] are still committed to correcting these defects. Some are pending the arrival of spares, and two of these defects are in dispute,” he said. “We are working to have these defects fixed before the end of this present crop,” he said.
According to Sangster, some 30 percent of the cane supplied to the Skeldon factory comes from private cane farmers. He said that when the project is completed, the contribution of the private cane farmers is expected to be about 40 percent.

Worker turnout
Bhim told reporters that worker turnout did improve slightly, but the situation on the Demerara estates was worse than at Berbice. He said that the Uitvlugt estate does not have the turnout to sustain a 24 hour operation. He said that the situation is better at Wales, because of the cane farmers’ supplies and a turnout of about 50 percent.
“Of more concern are the East Demerara estates, where the turnout has not improved as dramatically as it has in Berbice. We are struggling in East Demerara to keep the Enmore factory fully supplied with cane,” he said.

Production
Noting that the company’s production target is now 283,000 tonnes for 2011, Bhim said the company did suffer a decline in the quality of cane from the first crop of this year.
“Last year we brought over a lot of cane from 2010 into 2011, because of the bad weather we experienced, particularly at Skeldon,” he said, noting that canes were as old as two years and thus lost some of its quality, thereby contributing to the decline in production.
“To date, we have produced 166,000 tonnes of sugar for the year,” Bhim said. He said that while the company is going to lose revenue because of the decline in production, the world market prices for the commodity have gone up significantly, and “we are taking advantage of the increase in the world market price.”
He said that the sugar that Guyana is selling to the U.S. and CARICOM markets is traded in world market prices.
“Because of those improved prices, we think we will be able to come out of the year with a fairly even financial position, even with the decline in production,” he said.
The CEO noted that GuySuCo was able to make a US$4.5M payment towards a US$17M Citibank loan that the company borrowed in March 2011.
“The balance of it will be repaid by mid-December. We are a little behind with our creditors, both local and foreign; but as we pick up with our sugar shipments, that situation will improve rapidly by the end of this month,” he said.