Secret deal for Skeldon Estate takeover revealed

From left: DRCL Representative Ivan Cabrera, DRCL Director Avinash Rampersad, DRCL Chairman Nirmal Rampersad, Minister Noel Holder, GuySuCo CEO Errol Hanoman, DRCL Local Representative Noel Shewjattan and GO-Invest CEO Owen Verwey

T&T company with no experience to:
Produce bulk rum
Develop solar power
Produce ethanol

Govt to:
Provide lands for cultivation
Provide infrastructure
Provide massive tax incentives
Guarantee pricing formulae

A Trinidad and Tobago firm is likely to rake in major benefits from the Guyana Government, including favourable tax incentives for the development of an integrated sugarcane processing facility at the Skeldon Sugar Estate, after a Memorandum of Understanding (MoU) was inked in December.

From left: DRCL Representative Ivan Cabrera, DRCL Director Avinash Rampersad, DRCL Chairman Nirmal Rampersad, Minister Noel Holder, GuySuCo CEO Errol Hanoman, DRCL Local Representative Noel Shewjattan and GO-Invest CEO Owen Verwey

Government, through its Guyana Office for Investment (GO-Invest), signed the MoU with D Rampersad and Company Limited (DRCL) on December 8, 2016, for the undertaking of a feasibility study to determine the success of such a venture which will see it taking over the Skeldon Estate. The MoU was signed without full disclosure to the Guyanese public and without any public notice or public tender. The company has no experience with any agricultural enterprise, and provides engineering services to the automotive and oil industries in T&T.

Notably, however, as witness to the signing was Noel ‘Rupie’ Shewjattan, the owner of Auto Fashion Store on Garnett Street, Campbellville, Georgetown. Auto Fashion Store also has no experience in the agricultural sector.
Meanwhile, in the MoU, which was seen by this publication, the Company believes that the sugar industry in Guyana can be “regenerated” by the proposed project, which would not be producing sugar.


DRCL is slated to benefit tremendously if its project proposal is approved by the current coalition Administration. From the size of DRCL’s operations in Trinidad, it appears doubtful it would be able to finance a project of the magnitude proposed.
According to the MoU, some expectations in the event a definitive agreement is entered into would include access to key infrastructure, favourable combination of tax incentives, and land for sugarcane cultivation and infrastructure.
The company is also set to receive reasonable approval cycles, guarantees on minimum product take-off by the Government with respect to electric power and fuel ethanol, guaranteed pricing formulae and power export provisions.
This means that while the company will convert sugar cane into ethanol and electricity from bagasse, the Government will assume the responsibility of purchasing the products at some yet undisclosed price. For ethanol to be used as fuel by motor vehicles, their engines would have to be modified. It was not disclosed if the Guyana Government or DRCL would bear the cost of the engine modification.
The feasibility study is proposed to commence on April 3 and to be completed in the first quarter of the year.

The integrated sugarcane processing facility will include developing an integrated sugar-to-ethanol and electric power project. While sugar will not be produced, the Skeldon factory will still have to process the sugar cane all the way to the molasses stage, but the diffuser for extracting the sugar will become redundant.
Basically, the feasibility study will examine the cultivation and harvesting of sugar cane and sugarcane processing.
It will also look at the production of fuel-grade ethanol, and the production of bulk rum for local, regional and international markets.
The feasibility study will also focus on power production from bagasse, production of high-test molasses, the construction of a liquid bulk terminal and the development of a solar power generation facility. The findings of the feasibility study will provide critical information and set the platform to make a definitive project proposal to the Government of Guyana.Meeting
The present Administration has been very critical of the Skeldon Estate and has conveyed impressions of wanting to privatise the factory and its corresponding operations.
Agriculture Minister Noel Holder had told media operatives that Government received a number of Expressions of Interest from parties desirous of purchasing the Skeldon Estate, as well as the overall Guyana Sugar Corporation (GuySuCo).
Late last year, Holder met with a delegation from DRCL to discuss its proposal.
During this meeting, the Agriculture Minister maintained that Government was open to investing through land leasing agreements. At that meeting, DRCL was represented by its Director, Avinash Rampersad. The company’s local representative, Shewjattan was also present.
Government is pushing towards this project in an effort to promote its green economy initiative, while at the same time dismissing the Amaila Falls Hydropower Project (AFHP)) – which a Norwegian firm recently deemed as the only realistic path for the country to move towards an emissions-free electricity sector. Norway has already allocated US$80 million towards the realisation of AFHP.
Instead, Government wants to pursue wind energy even though the Norway Report considered hydropower the best option for Guyana.
In fact, the report proves that wind energy – at least in the capacity in which Government is currently pursuing – will not support Guyana’s commitment to reach 100 per cent renewable energy by 2025.
Lloyd Singh, a known Alliance For Change (AFC) financier who constructed the AFC headquarters, is currently negotiating with AFC General Secretary and Public Infrastructure Minister David Patterson for a Power Purchase Agreement that was never tendered for, for the development of a wind farm at Hope Beach. (Guyana Times)



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