-no word on penalties for new factory delay
After successful trials, the Guyana Sugar Corporation (GuySuCo) yesterday prepared to begin grinding its bumper harvest at the old Skeldon sugar factory.
According to GuySuCo General Manager–Technical Services, Yusuf Abdul, grinding will start either tonight or tomorrow morning. Grinding at the Skeldon sugar estate was halted when the new US$181 million factory experienced major mechanical setbacks earlier this month. GuySuCo was forced to reassemble the old factory in an effort to save the current crop — the bumper crop for the year — to meet export market demands.
Meanwhile, China National Technology Import and Export Corporation (CNTIC) Representative Andrew Jin told Stabroek News that based on the assessment and remedial action being taken at the new factory, it is expected that the commissioning would be held during the first week in October. He said he hoped that the factory could be handed over by the end of October. Once the factory is handed over by that time, Jin said, it could go into commercial operation and process the remainder of the current crop over a one and a half month period, thereby saving much of the crop and boosting production.
Asked about reported penalties being imposed on CNTIC — which was contracted to build the state-of-the-art factory — Jin said he was not aware that penalties were imposed since all the discussions have been focused on getting the factory up and running.
He said both parties have contractual obligations and that the contract was not between the government and CNTIC but between GuySuCo and CNTIC. Top-level GuySuCo representatives, who have been meeting with him on a regular basis, he said, had not informed him of any penalties, which would have to be applied after September 23 (today), once the factory was not handed over.
Jin said CNTIC was prepared to meet certain obligations, but he was not prepared to say what those were. Nevertheless, he said, there is going to be an amicable resolution to the problems. He said CNTIC and GuySuCo are aware that the commissioning of a plant of the magnitude of the Skeldon factory was going to be challenging.
After the handing over of the factory, when CNTIC ceases to be in charge of the operations, Jin said, GuySuCo still wanted the contractor to stay for an additional year. He said, “We can discuss that and reach an amicable solution.”
Asked about the penalties for liquidated damages on account of the failure of CNTIC to hand over the factory, Chairman of GuySuCo’s Board of Directors, Ronald Alli told Stabroek News yesterday that while the liability period would start from September 24 (tomorrow), the focus at present was not on the imposition of penalties. He said that once the new factory was commissioned, more attention would be paid to the terms of the contract and the obligations of both GuySuCo and CNTIC, since both parties might be culpable for the delay. “At this time, we are eager to get back to retesting,” he said.
Before the factory is handed over, CNTIC is required to conduct a 24-hour test and a 72-hour test; these must be successfully completed. Afterward, there would be three other 72-hour tests over the next year and the contractor would still be liable for defects that might arise.
The construction of the Skeldon factory was completed in May with independent components successfully tested prior to the completion date. Work began on the factory in 2005 and it was expected that the project would have been completed by October last year. Since then the commissioning date has been pushed back several times with the last date being August 2. (Miranda La Rose)