Gov’t to Keep Stake in Clarendon Alumina Partners

The Government has decided not to continue with the process of di­vesting its shares in Clarendon Alumina Partners (CAP).

Minister of Science, Technology, Energy and Mining, Hon. Phillip Paulwell, made the announcement during his contribution to the 2013/2014 Budget debate on April 24 in the House of Representatives.

The government owns 45 per cent interest in Jamalco, which is vested in CAP, but has been attempting to sell its stake in the company.

Minister Paulwell said the decision was made by Cabinet after it received and accepted a report from its negotiating team.

The team was assembled to pursue and settle new arrangements, when on assuming office in 2012, it was discovered that the negotiations by the former administration for the sale of CAP to proposed buyer, Glencore, “was nowhere near complete”.

“A communica­tion from Glencore to the former Government’s negotiating team just before the 2011 General Elections indicated this position, including a number of conditions-precedent, which had not been met,” Minister Paulwell informed.

He said that the Government is now awaiting approval from Al­coa, which owns the remaining 55 per cent shares in CAP, which is expected by month-end.

“I cannot divulge details today, but the nation will be fully updated at the appropri­ate time. What I can say now is that the most difficult arrangement with Glencore, which had a fixed price component, ended in December 2012,” Mr. Paulwell stated.

He told the House that the negotiating team found that while production continued on behalf of the joint venture partners, no meetings of the executive committee had taken place for nearly a year.

As a result, he said, Alcoa was left to run the plant without any over­sight or direction by the committee.

“This administration immediately set that situation right by resuming executive committee meetings, and we have held them regularly since,” Mr. Paulwell informed.

He said it is expected that once the arrangement is finalised, CAP will continue operating, supplying Glencore at significantly increased alumina prices linked to the London Metal Exchange.

By Latonya Linton, JIS Reporter