Gov’t and UC Rusal to Conclude Discussions on Bauxite Plants

Representatives of the world’s largest aluminum company UC Rusal, will be visiting Jamaica later this month to conclude discussions on the future of their operations at the Alpart and Kirkvine bauxite plants.

Minister of Science, Technology, Energy and Mining, Hon. Phillip Paulwell made the announcement in the House of Representatives on Tuesday, May 6, while opening the 2014/2015 Sectoral Debate.

He expressed concern that the plants have been closed for five years, noting that the impact is too great to have them remain idle.

Minister Paulwell also informed that Cabinet has given approval to grant the Russian company a bauxite levy concession for an additional two years in respect of the Ewarton Plant, on the condition that it constructs a coal-fired energy solution at the plant.

“We are proceeding to conclude this agreement as soon as possible,” the Minister promised.

Backed by a 4.2 percent increase in the mining and quarrying sector in the 2013/2014 financial year, the Minister expressed optimism at the industry’s prospects.

“Despite the cyclical nature of this competitive industry, Jamaica is positioned to do well. Our first-mover advantage in infrastructure and quantity of reserves will make us a critical player for decades to come. Jamaica’s bauxite future is assured because the demand for bauxite in the global market is growing as some countries are restricting bauxite export,” the Minister said.

He emphasised that the government’s policy going forward, is that there will be no new agreements for the export of raw bauxite without specific conditions.

“While all existing agreements will be honoured, no new agreement will be considered unless it is accompanied by a commitment to build an alumina refinery with specific timelines for implementation,” Mr. Paulwell said.

He informed the House of a Memorandum of Understanding (MoU), that the Government signed with Xinfa Group Company Limited, in February of this year, which will see the Chinese Company constructing a two million tonne per annum alumina plant to operate for 25 years, and a coal-fired power plant to support the plant.

Minister Paulwell revealed that Cabinet has since appointed a team to pursue further negotiations to settle the terms of definitive agreements within six months.

“This means that on successful completion of the negotiations, we will not only be mining bauxite in that area of St. Ann as was the case with the Reynolds min, we will be producing alumina from St. Ann for the first time at last. This will be the first green field alumina facility to be constructed in Jamaica in 42 years,” the Minister said.

He gave assurance that the project will be implemented according to international best practices, and will be fully compliant with Jamaica’s environmental laws.

“This is a massive shot in the arm for the bauxite and alumina industry, and the Jamaican economy. It will mean the provision of jobs in the construction phase, and permanent jobs during the operations,” he stated.

Mr. Paulwell noted also that there are significant linkages to the proposed operations that will enable Jamaicans to provide goods and services to the project.

We will insist and ensure that these opportunities are maximized,” the Minister said, noting that these are the types of investments that can build the platform for sustainable growth and development.