Jamaica has bright bauxite future
FINANCE MINISTER Dr Peter Phillips has declared that Jamaica still has a bright bauxite future, despite the world economic recession in 2008 forcing the closure of three of the country's four plants.
Speaking in the House of Representatives on Tuesday, Phillips said UC Rusal, the owners of three bauxite plants, have indicated that "they are in Jamaica to stay".
"Bauxite-alumina has a healthy future in Jamaica which will only get healthier as the world's economy picks up and moves into a period of growth," Phillips said. He added, however, that "I would not say the best days are before it, because, in a sense, the earliest days were probably good days, but the fact of the matter is that there are significant prospects."
The minister noted that there has been a more than 15 per cent growth in the bauxite sector in the last two quarters.
Opposition Spokesman on finance Audley Shaw said the Kirkvine plant, which is owned by Rusal, is being scrapped.
"The plant is literally being gutted and shipped to, in some cases Ewarton, to support the plant there, and in other cases, it is being shipped as far as Guyana," Shaw said.
The Russian-owned Alpart and Kirkvine bauxite plants were closed at the height of the global recession. The Government has been engaged in negotiations with the owners for the resumption of operations at the facilities, which closed in 2009.
The owner, UC Rusal, said it is investing US$100 million in a coal-fired electricity generating system for Ewarton. A downturn in the global aluminium market forced UC Rusal to cease its operations at Kirkvine, Ewarton and Alpart in 2009. The Ewarton refinery, located in St Catherine, was reopened in July 2010.
Clinton Thompson, commissioner of the Mines and Geology Division, told The Gleaner recently that, based on developments, he is "optimistic and confident that the best is yet to come" for the sector.
The House of Representatives on Tuesday gave approval to a resolution for paving the way for the repayment of bauxite-related debts.
The massive slowdown of bauxite mining in Jamaica has led to Phillips turning up in Parliament with a withdrawal order to settle a US$33-million debt as a result of the failure of Jamaica Bauxite Mines to make good on an alumina supply agreement with Glencore.
Phillips said that, arising out of the failure to supply Glencore with bauxite under an existing agreement, the country has been left with a heavy debt, and US$6 million is required for the first two payments due to Glencore in the new fiscal year.
The finance minister said the balance of US$23.6 million is to be provided in equal quarterly payments in addition to eight per cent interest per year up to 2016-2017.