New investors for Barama concessions

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Part of Barama’s operations in Essequibo

— investments totalling US$9.5M by 2020 to create 524 jobs

THE Guyana Forestry Commission (GFC) has awarded two lots totalling over 800,000 hectares to R.L. Sukhram and Sons Sawmill and Rong-An Inc from the 1.6 million hectares of forest concession relinquished by Barama Company Limited in October 2016.

A release said the Natural Resources Ministry, along with the GFC, had taken the decision to divide the former Barama Company Limited concession into four parcels, each of approximately 400,000 hectares.

The ministry advertised two of those parcels as State Forest Exploratory Permits, which means that there is a three-year process of assessment prior to commercial, full-scale harvesting.
The third parcel was identified for conservation and research, while the fourth was identified for small-concession allocation of areas 20,000 acres and less.
Parcel one is a forest area of size 417,809.23 and is located in the Essequibo region (North-West, Mazaruni Potaro District), while Parcel Two is a forest area of size 432,262.59 and is located in the Essequibo region (North-West, Mazaruni Potaro District).

The concessions are located in North-west Guyana in Region One in the Barima-Waini, and Region Seven in the Cuyuni-Mazaruni sub-regions.
The concession areas both have a high occurrence of a number of high-value commercial timber species, including Baromalli, Greenheart, Purpleheart, Mora, Wallaba, Crabwood and Kabukalli, among others.

Parcels one and two were opened for Expressions of Interest (EOIs) for the period ending February 10, 2017. These were advertised in the local media as well as in the international publications ‘Development Business’ and ‘The Economist’ and placed on several websites.
Ten submissions were made at this deadline — some for both parcels — while others were for one or the other. These firms were invited to submit State Forest Exploratory Permit (SFEP) applications, pay the non-refundable fee, and complete a Business Plan Summary by April 28, 2017.

At the deadline of April 28, 2017, five applications were received, namely from Chemtech (Trinidad firm) for Parcel One, R.L. Sukhram and Sons Sawmill for Parcel Two, Rong-An Inc. for both Parcels One and Two, Forlene and Sons for Parcel Two and ACE Resources (Canadian firm) for both parcels.

Following the receipt of applications, the technical sub-committee of the GFC Board of Directors conducted a full review of each application.

The review of the technical sub-committee concluded that Parcel One should be issued to Rong-An Inc. and for Parcel Two to be issued to R.L. Sukhram and Sons Sawmill for a three-year period commencing July 2017 to July 2020.

Following this process, a recommendation was made to the full board of directors at the 129th meeting held on June 27, 2017 approved for Parcel one to be allocated to Rong-An Inc., and for Parcel two to be allocated to R. L. Sukhram and Sons. This decision was approved by the full board and has been implemented by the GFC.

It is expected that the awarding of the two parcels will result in benefits to the forestry sector over the course of the full operationalising of the utilisation/harvesting plan for the concession.

These include a total investment of US$9.5 million by 2020, a total of 524 new jobs when the operations are at full scale, an increase of national production level by at least 189,000 m3 annually, an increase in export revenue by at least US$7 million, and an increase in harvesting of Lesser Used Species from the current 10-15 per cent to at least 25 per cent of total production.

The Ministry of Natural Resources urged R.L. Sukhram and Sons Sawmill and Rong-An Inc to carry out their operations in a manner that is compliant with the GFC Code of Practice and other laws and regulations, respectful of the environment and beneficial to the people of Guyana.