US$181M Skeldon factory commissioned

Aug 23, 2009 News

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– Hailed as key to survival of the sugar industry

 

By Neil Marks

 

The Skeldon Sugar factory was formally commissioned yesterday by President Bharrat Jagdeo, who again trumped up the state-of-the-art facility as Guyana’s boon to ensure the survival of the sugar industry, which last year saw its worst production figures in 18 years.

The factory was completed at an estimated cost of US$181 million, making it the single largest investment in this country’s history.

The establishment of the factory is part of a modernisation plan by the Guyana Sugar Corporation (GuySuCo). The project involves expanded cane cultivations, the establishment of a refinery, and the co-generation of electricity for the national grid.

Agriculture Minister, Robert Persaud, said the opening of the factory marked a new chapter in the epic saga of our sugar industry.

“This particular new episode has been scripted after a profound assessment of where the sugar industry is positioned today, the challenges it faces, and the identification of what is needed to facilitate a globally competitive industry that would continue to contribute to the development of our country and the well-being of our people,” Persaud stated.

Chairman of the Berbice region which produces most of the country’s sugar, Zulfikar Mustapha, hailed the opening of the new factory as a symbol that the government intends to regenerate the vibrancy of the economic fortunes of the country.

The opening of the factory comes just over a month before Guyana, and the rest of the countries of the African, Caribbean and Pacific (ACP) Group of countries, lose preferential market access for its sugar to Europe. The industry is already reeling from the reduced price Europe began taking for its sugar in 2006. In 2010, the price cut will go to the full 36 percent Europe imposed.

The sugar industry directly sustains some 18,000 jobs, and when that is multiplied to include their families, it means sugar supports a fifth of the country’s entire population. Sugar exports account for as much as 20 percent of the country’s annual revenue. Therefore, the survival of the industry is seen as crucial to the country’s economic and social stability.

When the sugar industry was directly affected, last year’s drop in production to 226,000 tonnes sent alarm bells ringing, with the main workers’ union, GAWU, charging mismanagement by now South Africa-based Booker Tate. GuySuCo manages the industry countrywide and is now run by a local team.

The new factory is intended to increase national production to more than 450,000 tonnes. It is now the most modern sugar factory in the Caribbean. The use of continuous process equipment in place of traditional batch equipment is expected to improve operating efficiencies and reduce energy consumption. The entire process from cane receiving to sugar dispatch will be highly automated and will be controlled by a central control system.

The new factory uses bagasse (the waste of the sugar cane) as fuel. This represents a renewable energy source, and also supplies electricity to the national grid. Sale of power to the Guyana Power and Light Company began in December 2007. This has helped to stabilise the power supply in Berbice and when the factory swings into full generation, it will provide most of the daily base load power requirement for Berbice. The co-generation factory has the capacity to supply 10 MW of firm power daily from one 5.0 MW set and two 2.5 MW sets.

The new Skeldon sugar factory has been operational since March 2009. Operations have from time to time met with difficulties but this is not unusual when new equipment is being tested, GuySuCo countered. The Defects Notification Period (Warranty) expires in October 2009 for the punt dumpers and March 2010 in respect of the remainder of the plant.  Management is confident that during these periods all major defects will be remedied.

The Corporation is targeting the end of 2011 to complete all land development and planting and expects to have in this period the 1.2 million tonnes of cane required by the new factory. Estate cultivation of sugarcane will have to grow to 9,600 hectares.

Farmers are partnering with GuySuCo on this project and their canes will supply around 30 percent of the total canes delivered to the mill. 

The factory was constructed with a combination of self-generated funds and loans from the Caribbean Development Bank, the People’s Republic of China and the Government of Guyana. The Project Engineer was Booker Tate, UK Ltd and the Contractor was CNTIC Ltd.

The new Skeldon factory incorporates some of the best technologies from the world of sugar manufacturing. These technologies are applied to provide a high efficiency manufacturing process that makes the best recovery of the sucrose and the energy in the raw sugar cane. This energy is harnessed to power the factory in converting the sucrose to sugar crystals and the surplus energy is used in the national grid.

Other advanced technologies that characterise the New Skeldon Factory include: an improved automated punt dumper for offloading cane; a cane shredder to increase extraction; air supported belt conveyors throughout the factory; all electric drives to reduce energy consumption; self cleaning, single pass, high efficiency boilers; and pollution controls to World Bank standards, including electrostatic precipitators.

Chinese Ambassador to Guyana, Zhang Jungao, said the Skeldon Modernisation Factory marked a new milestone in the economic partnership between Guyana and China.

A fireworks display ended yesterday’s official opening ceremony.

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