GKB joint venture says it was Govt. that recommended Enmore as suitable site

Feb 24, 2022 News

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– Clarifies it was only leased packaging plant, not the entire sugar estate
– boasts that US$37.5 million investment is unmatched

Kaieteur News – The announcement on February 16, 2022 that Guysons K+B Industries Inc. (GKB), a 52 % Guyanese owned joint venture acquired a 55-acre plot that includes the US$12.5M Enmore Packaging Plant to be transformed into a manufacturing facility to support the oil sector, has plunged citizens into a state of worry over the apparent disposal of national assets.
Chief among the burning issues is why the government has chosen to lease the said lands with the plant after it was deemed, time and again, to be a crucial part of the plans to revive sugar. Another crucial concern is the price at which the PPP/C Administration leased the national asset to the company.

While the government has yet to come forward to address the said issues, among others, the company released a statement yesterday to clear its name and to assure citizens that it has the best of intentions.
Guysons K+B Industries was keen to note that its record of investment in Guyana and its people dates back to 1992 when Guysons Engineering was founded in West Ruimveldt, Georgetown, a then economically depressed community. After nearly three decades of growth and prosperity, Guysons shared that it teamed up with the US-based K+B Industries, a leader in manufacturing, engineering and machining in 2020, to ramp up services provided to the oil and gas sector.
It said that a key investment the joint venture, GKB, committed to make is in the people of the East Bank Corridor, plugging US$37.5 million (GY$7.5 billion) to establish the Enmore Manufacturing Plant as a state-of-the-art Oilfield Services facility. The company said a minimum of 50 acres of land is required to effectively deliver OCTG & Premium Accessory Services to the O&G Sector and for this, GKB engaged the Government. GKB said it proposed a site closer to port facilities in Georgetown but saw merit in the “Government’s recommendation of Enmore.” Importantly, GKB said its lease is for the Enmore packaging facility, not the Sugar Estate, which is approximately 100,000 sq. feet. “To build such a facility would take an estimated 18-24 months, whilst the Enmore Sugar Packaging Plant can be repurposed and become operational, almost immediately, preserving jobs currently held at the Plant, with a guarantee of a minimum of 150 by end of year 1 and a minimum of 500 by end of year 5,” the company stated.
It further noted that the OCTG and Premium Accessory Service that GKB intends to provide is currently outsourced to Trinidad & Tobago, the United States of America, and farther afield. “This initiative would increase commercial activity on the East Coast Corridor and tap into considerable foreign exchange earning potential, bringing greater Oil & Gas revenues to Guyana. Significantly, this would be the first time ever that these services are provided in-country,” GKB reasoned while adding, “The total investment of US$37.5 million (G$7.5 billion) into the East Coast Corridor is unmatched.”
GKB further stated that it endeavors to train residents of the East Coast Corridor. GKB plans to create and guarantee 150 jobs in the first year with an initial injection of US$7.5 million (GY$1.5 billion).
Within three to five years, GKB said that the guaranteed number will increase to 500 jobs while reiterating that it has committed to rehiring 100% of the workers currently employed at the Enmore packaging plant. “We will see to it that our expansion uplifts economically-depressed communities of the East Coast Corridor with sustainable jobs which will serve as a revitalizing lifeline for its youth and laid off sugar workers. GKB has also agreed to strict land development timelines and milestones over the first three years that will be monitored as the phased development occurs,” the company stated.
GKB in conclusion, said it remains committed to the development of the East Coast Corridor, including Enmore, Haslington, and the surrounding areas.

SUGAR LANDS WILL BE ACQUIRED
In a February 17, 2021 report, Kaieteur News noted that the new manufacturing facility at Enmore will be set up to manufacture and repair tubular goods such as drill pipes, drill covers, etc., needed by oil companies to develop oil fields. GKB will also offer premium threading of the tubular goods, accessory services and Turnkey manufacturing solutions in the country.
As it relates to the arrangement between the government and GKB for the lands and the US$12.5M packaging plant owned by the Guyana Sugar Corporation (GuySuCo), GKB’s Chief Executive Office, Fazil Khan, was willing to share some details with this newspaper in an exclusive interview.
Despite negotiations are still ongoing between the two parties, Khan said that an agreement has been made for his company to purchase 25 acres of the land, lease another 25 and also lease the packaging plant on a long-term lease. Consultant Advisor on the project, Rosh Khan, who spoke with this publication also pointed out that GKB will not be granted all of the lands at one time. He explained that GKB will begin with 25 acres and the packaging plant which spans an area of at least five acres. In order to lease the remaining 25, it will first have to complete all of the commitments it made with Guyana.
GKB’s Khan confirmed this and noted too that considerations were also taken to safeguard against a scenario where Exxon can pull out. “You don’t want to invest or buy then Exxon pulls out of Guyana because it can happen and you can lose,” Khan said.
Asked if any agreement has been with the government on the purchase and lease price, Khan responded that these are still in the process of being negotiated. However, the CEO assured that it will be a fair one for both parties and revealed that his company has committed to an overall commitment of US$60M towards the development of the project. Out of this amount, Khan said, more than US$7M has already been expended. The CEO further highlighted that the lands it is acquiring are “sugar lands”, which will have to be developed in order to become a standard facility. “We will have to do some land filling, land clearing, probably install some streetlights and so on before we can start up the facility,” explained Khan.

 

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