Duty Free Fuel… RUSAL sells excess electricity to Amerindian Village at GPL rates

Nov 27, 2019 News

…guaranteed payment by deducting owed lease fees as ‘light bill’

Russian-owned and controlled Bauxite Company of Guyana Inc. (BCGI/RUSAL) imports fuel duty free for its operations, which includes generating massive amounts of electricity; it then sells the excess electricity it produces to the Hururu Amerindian Village, but at the same rate as the Guyana Power and Light (GPL).
The company has been doing this for almost a decade now with a guaranteed source of payment, using monies it was supposed to pay to the village in the first place. This obtains through a land lease arrangement with the Village Council, together with sale contract for electricity.
The Hururu Amerindian Village Council agreed to lease large swaths of land for bauxite mining, transportation and other purposes to the Russian Company for $1.2M each month.
The company also inked an agreement in November 2011, to sell the village its excess electricity, but at the same rate that GPL sells its consumers, and with a caveat.
The rates would be increased arbitrarily in accordance with any increases GPL makes to its rates.
What this led to, is that the company simply deducts the money it is supposed to pay to the Amerindian Village for leasing its land, and instead calls it money now owed to the company, for electricity – essentially, a ‘light bill’ for excess electricity generated by the company for its own operations, using duty-free fuel.
Compounding the situation is the fact that the Amerindian Village is not only being made to pay for the excess electricity through its lease fees—electricity sold at the highest rate in the Caribbean—but they are also responsible for keeping the ‘distribution network path’ or “electrical lines path clear from any obstruction that would make it imposable (sic) for the company personnel or vehicles to traverse.”
This means the village, in addition to having its ‘rent owed to it’ deducted as ‘light bill’, is also responsible for clearing the distribution network.
The agreement also indemnifies the company from any injury or death to any of the villagers using the electricity supplied by RUSAL.
The company is currently being investigated by the Guyana Revenue Authority over allegations it is reselling up to a third of the fuel it imports.
Independent investigations by this publication have revealed that the company has been in the business of fuel sales from its inception.
RUSAL has been granted a waiver of duties as part of an incentive for its investment in Guyana.
This means that the 50 per cent tax normally paid to the government on the importation or purchase of the fuel is not being paid by RUSAL.

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