Jerome Reynolds, Gleaner Writer

The Government and representatives of bauxite and aluminium giant UC Rusal are to hold what Energy Minister Phillip Paulwell calls "critical talks" on January 14 as the administration seeks to secure a deal to get the Alumina Partners of Jamaica (Alpart) and Kirkvine bauxite plants back in operation.

The Government and UC Rusal have been in discussion for some time, hammering out an agreement.

The downturn in the global aluminium market forced the Russia-based company to close the plants in 2009.

Paulwell told the Gleaner/Power 106 News Centre that the main hurdle in securing a deal is settling on a reasonable source of energy which will be incorporated in the energy mix for the running of the plants.

UC Rusal has cited the high cost of electricity in Jamaica, which is primarily oil-based, as an area of concern for its business operations in the country.

SEEKING BEST OPTION

Paulwell said the discussions would focus on identifying the best energy options for the plants.

"Both Kirkvine and Alpart as part of the base location going forward, will have to incorporate a permanent energy solution. We are now in discussions as to what the solution will be, and we are intent on finalising that on January 14," the energy minister said.

The Government has been pursuing liquified natural gas (LNG) to be introduced as an alternative source of energy.

As part of that project, the Government had intended to build LNG floating storage and a re-gasification terminal, and seek out a supplier of approximately 830,000 tonnes of LNG per annum.

Amid shifting deadlines, Paulwell announced in Parliament last October that the Government had decided to turn over the project to private hands.

The project has been taken up by the Jamaica Public Service Company Limited, which will be establishing the LNG infrastructure and sourcing the gas for its new plant in Old Harbour, St Catherine.

Meanwhile, Paulwell said the Government would continue to insist that UC Rusal provide a clear timeline as to when ALPART and Kirkvine will reopen.

Said Paulwell: "They know that their licences will not be tenable unless we finalise a day for reopening. So all parties are aware that this is a fundamental issue that has to be settled."

In October, the Government entered into a Bauxite Levy Concession Agreement to avoid the closure of the Ewarton bauxite plant in St Catherine and 600 workers being sent home.

The one-year agreement runs from October 1, 2012 to September 30, 2013.

During the period of the levy, Ewarton is required to maintain the current staff level as well as its production capacity of 300,000 tonnes per annum.

jerome.reynolds@gleanerjm.com