Record-breaking speed of oil sector forces Guyana to import stone

Jan 20, 2023 News

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…increases award of quarry licences  

Kaieteur News – The accelerated pace of activities in the oil and gas sector has resulted in a massive construction boom. Senior Finance Minister, Dr. Ashni Singh noted this during the presentation of his 2023 budget on Monday, stating that there is a massive ramp up in the construction of homes, hospitals, schools, roads, bridges and even infrastructure to support private sector investment. The construction boom he alluded, has also placed unprecedented pressure on the sand and stone industries which is struggling to keep up with demand.

Facilitating the need for more materials last year like sand and loam are 22 operators to date.  Dr. Singh said these outputs saw production almost doubling last year. He said Government, in 2023, will continue to promote accelerated investment in the sub-sectors and ensure that concessions are brought to production in the shortest possible time in order to boost productivity.

Similarly, Dr. Singh said stones reached record high levels due to the construction boom. The Minister said currently operating quarries collectively ramped up operations in 2022 to produce a record 1,021,000 tonnes: the highest in over a decade. But even this is unable to meet the high levels of demand. In fact, Dr. Singh said an additional six quarries were recently licensed and are expected to contribute a further 400,000 tonnes in 2023. He said these licence awards reflect Government’s efforts to ensure construction materials rise to match demand from housing and the other infrastructure works across the country.

Vice President, Dr. Bharrat Jagdeo had said last year that Government would be forced to import stone from Canada and other territories to ensure projects are not left stranded or at a standstill due to shortage of key inputs. A report by local media entity, Demerara Waves also quoted the Vice President as saying that the demand for stone is calculated at 6 million tonnes for 2023. He also said that Guyana’s demand for stone could not be satisfied by neighbouring Suriname, and Trinidad and Tobago. (See link: https://demerarawaves.com/2022/12/30/guyana-mulls-buying-stone-from-canada/#:~:text=Vice%20President%20Bharrat%20Jagdeo%20on,and%20rehabilitation%20works%20in%202023.)

In the meantime, the Environmental Protection Agency (EPA) has given the green light for two companies to move ahead with their sand pit development projects.

Castle Point INC., one of the companies granted permission, said it is eager to help in meeting the national demand for sand resources by establishing a viable and environmentally compliant Silica Sand and Loam mining operation at the Canal #2 backlands, West Bank Demerara. In accordance with statutory regulations, it presented a mine plan for the proposed Silica Sand and loam mining project on 184 acres of state land.

Borehole data and previous work done has indicated a mineable resource estimate of approximately 14,219,034 tons of sand resources and 31,468 tons of Loam resources. With a capital investment ofUS$292,000 and an annual operating cost of US$260,183, the mine would produce approximately 200,000 tons of Silica Sand and 10,000 tons of loan per year for construction and industrial purposes over the life of mine while providing full time employment for 10 persons initially.

The other project which received EPA’s go-ahead is led by developer, Hareshnarine Sugrim. The area applied for is approximately 1,189 acres of state land in the county of Berbice. The project is being designed to produce a combined 50,000 metric tons of sand, loam and laterite per year in its initial capacity. This may increase when the project recovers capital expenditure and if the demand justifies further investment in expanding production capacity.

Kaieteur News understands that the mine output will be transported by barge down the Berbice river to New Amsterdam. The mine will produce sand, loam and laterite to be used primarily as fill materials in the construction sector.

Government is presently developing several major infrastructural projects in the county of Berbice, including several roads. There are also numerous private sector developments related to the oil and gas sector, such as the CGX shore base being developed on Crab Island. Presently there are no formal, organized, reliable open pit mines in Berbice to supply the necessary fill material for these various construction projects. In light of this, Sugrim estimates the current demand for fill material to be approximately 50,000 metric tons per year. This is a conservative estimate and it is expected that demand will be increasing consistently over the next few years as the oil and gas sector expands and drives national development.

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• Dr. Ashni Singh, oil sector, quarry licences, Sand and Stone, Senior Finance Minister

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