Balford Henry, Senior Reporter
DESPITE GOVERNMENT'S insistence that the sale of 400,000 tonnes of bauxite to ALCOA announced in January by Prime Minister Patterson is still on, industry sources are convinced it is dead.
Minister of Mining and Energy, Robert Pickersgill, said yesterday that although the supply arrangements were not concluded within the original timeframe announced by Mr. Patterson, the sale was still under consideration.
"There are still some pricing issues and technical matters to be sorted out," the Minister said. However, neither the Bauxite and Alumina Trading Company (BATCO) nor the unions involved in the industry seem to share his optimism.
"Regretfully, we believe that the deal is not going to come through and it is time for Government to admit that," said UAWU vice-president Lambert Brown.
Last month, The Gleaner's Mandeville correspondent quoted Managing Director of BATCO, Lastenia Davis, as saying that the plan to ship the 400,000 tonnes of bauxite to ALCOA's Comfort Point plant in Texas seemed likely to fall through.
According to the correspondent, Mrs. Davis said that the merger of ALCOA and Reynolds Bauxite had stalled the project. In May, the US Department of Justice and the European Union approved ALCOA's acquisition of Reynold's assets. Although Mrs. Davis had admitted that there was a chance that the deal could go ahead, she pointed out it has been put on hold.
In the meantime, National Workers Union (NWU) bauxite/alumina industry spokesman, Norman DaCosta, called on the Government to tell the nation the true status of the deal. Mr. DaCosta said that his understanding was that the deal had fallen through, as ALCOA felt that the price was uncompetitive.
The Gleaner understands that the main problem was that when the deal was announced by the Prime Minister in January, the details were not yet worked out. A source told The Gleaner that although the pricing was crucial, at the time the Prime Minister made the announcement, the Government did not know the price at which it would have to purchase the bauxite nor the price for which they would re-sell it. The deal was to fill an export gap created by an explosion at the Gramercy plant in Louisiana in July of last year.
Mrs. Davis claimed that it was not a sales agreement that was announced by the Prime Minister, but negotiations for the sale of the bauxite between ALCOA and the Government.
However, in making the announcement, Mr. Patterson had announced a deal between the Government and ALCOA and that the shipments would begin by February.
He said that the shipments would represent the first to Point Comfort "for nearly a quarter of a century" and were the first in a series of developments which would see "greater co-operation" between the Government of Jamaica and ALCOA in developing the local bauxite/alumina industry.
The sale to the Texas plant was designed to keep production level up by maintaining the sector's employment level until the Gramercy plant returns to operation. A previous arrangement for Kaiser to supply the Ukraine with some 250,000 tonnes of bauxite, has already been completed.
Mr. Pickersgill said that, in the meantime, Kaiser Bauxite will be supplying 600,000 tonnes of bauxite to Gramercy during the rest of the year. The Gramercy plant is now expected to start the production of alumina by the end of September. Full supply arrangements will commence in January 2001, with 2.5 million tonnes projected to be shipped this year.
