Reconsidering Amaila Hydroproject

Jun 27, 2018 Letters

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Dear Editor.
When I was in Parliament I was rotating as chairman of the Economics Services Committee [ESC] with Gail Teixeria of the PPP. We asked GPL to come before the committee to tell us what is going on at GPL and in particular, what were their plans to explore renewable power opportunities for Guyanese. This was some time late in 2008 or early 2009.
The minutes of this meeting are there in Parliament for any enterprising young reporter to investigate. I am not sure if the then PM Samuel Hinds was with the delegation. I believe that he was, but Board Chairman Winston Brassington and CEO Bharat Dindyal were there.
What I heard at that time was that the Amaila Hydropower project would cost US$180 million to build the dam, and US$200 million to bring the power to the coast— a total of US$380 M. Some time in 2009 I left Guyana to live temporarily in the US and returned in 2011.
I say temporarily, since I have never applied for a Green Card to live in the US. When I came back after an absence of less than two years, the cost of Amaila had risen to US$800 million. Now in a recent article we are told that Minister Trotman is saying that it is now tagged at US$900M-plus and is still on the table as far as he is concerned.
This hydro project is set to generate 165 megawatts and was deemed too costly by this same government, as recently as last year 2017.
Also why build a plant which can barely service us now? Most of our big manufacturing businesses generate their own power—all the fisheries, all the drinks manufacturers including Banks, DDL, all the sawmills, places like Giftland, etc., Banks alone has a one-megawatt Generator.
So if the present Demerara-Berbice interconnected system is currently supplying around 125-130 megawatts, are we estimating that all of the big businesses now self-generating, only account for 30 Megawatts?
And if that is so, what about expanding new and existing business? Unless this government’s policy has deviated from the Hoyte policy of letting the private sector fuel the growth of the Guyana economy, is no longer in effect? And for example, what are we planning to do with our Bauxite? Keep selling the raw ore for US$35/Ton forever? Or try to make aluminium which sells at between $2000-2500 US /ton.
To have hydro power potential such as ours estimated at 7.5 Megawatts and Bauxite ore in the same country is a gift from the Almighty. I did not say so, this link to Norway says so:- https://www.hydro.com/en/products/energy/Hydropower-and-aluminium.
“Ever since Hydro started producing aluminium in 1963, hydropower has been a critical part of the process. You could almost say that hydropower was the reason why aluminium production could start up at all”.
“Hydropower + aluminium = success, the plant in Karmøy is a typical example of how hydropower and aluminium production has been a successful partnership throughout Hydro’s history.
“Without Norway’s unique hydropower history we [Norway} could not have become one of the world’s top aluminium nations”. President Burnham knew it, but I believe that the British and Americans did not want him to have the ‘power’ of making Aluminium which is a very strategic metal and getting more important.
The Tesla motor car’s entire body is made of aluminium to make it light for Battery operation, so aluminium will get even more important as time goes on. Most engine blocks are now made from Aluminium, the aircraft industry uses a lot of it as well.
One ton of Bauxite sells for between US$32-US$38. One ton of Alumina sells for around US$300 per ton but the alumina price has been fluctuating quite a bit, “Metal Bulletin’s ‘benchmark alumina index’ recorded lows of US$198 in December 2015, which rallied to highs of $481 in October 2017, with multiple ups and downs in between.”
Two tons of Bauxite is normally required to make one ton of Alumina, but the purity of the ore will make it higher or lower, and four tons of bauxite or two tons of Alumina are required to make one ton of Aluminium.
All that is separating us from selling aluminium at US$2000-US$2500per ton, which is made from four tons of Bauxite Ore [US$35×4] which earns only US$140, is electrical power!! Even if we leave this bauxite in private hands [Chinese] we will still insist that they must make aluminium, or we should buy the ore and make the aluminium ourselves.
We must stop putting decision makers in power with a salt goods shop mentality. The PPP Government refused to subsidize the Bauxite Industry which has led to its sorry state today.
Mr. Jagdeo himself said words to the effect that the industry can do what it wants to do, as long as he does not have to supplement it from the consolidated fund. I personally heard him say so at a media brief when I was the publisher of the Evening News.
My reaction is that it is too small to do much except make our current power more reliable, but at that high cost of US$900+ million for that small amount of power, it is probably a dicey project in terms of making our power cheap enough to make us competitive.
If so, what would be the point of doing it? It’s just posturing. It’s supposed to be a closed issue!
The Government of Norway has released the report on the review of the Amaila Falls Hydropower Project (AFHP) done by Norconsult, an engineering and design consultancy firm out of Norway.
It was commissioned to complete an ‘objective and facts-based’ assessment of the project on the agreement of two Governments”.
In 2018, exactly one year later to the day, Minister Trotman is now saying that it is still on the table.
Tony Vieira.

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