Dear Editor,
As part of my research, I had the privilege of reading Ravi Dev’s article “The Ethanol Option” of December 2008. What a profound thinker. I then took the opportunity to see what President Jagdeo promised in his 2006 Manifesto on the Ethanol Question and expectedly, I found another unfulfilled promise from the great leader. Page 16 of the PPP manifesto states, “The principal objective of our economic policy agenda is to promote higher and sustainable levels of investment and economic growth, create jobs, and maintain and improve social welfare.” This document further stated, “We will finalise the National Adaptation Strategy for the sector (sugar), secure finance for the various elements and ensure effective implementation. This will lead to the industry overcoming the negative impact of the EU reform to remain profitable. Towards this end we will – increase sugar-cane production to support production of ethanol. Further, on page 19, of that document it states that, “We intend to make reliable and affordable electricity available to all Guyanese and our industries. To accomplish this objective we will aggressively promote the development of renewable energy sources. Guyanese can look forward to production of fuel ethanol from sugar cane and other crops as a gasoline replacement locally and for export, lowering cost of living and providing opportunities for employment, farmers and economic development.
Chilling phrases from a document sanctioned by a failed leader since very little of it was implemented, if any. In the real world, CEOs are fired for this level of intellectual bankruptcy and under-performance, yet this leader apparently has the audacity to harbour ambitions for a third term. Is there no honour among the political class anymore? This ethanol question will stand out as one of the worst political deceptions of all time in Guyana’s history.
In July 2007 at an Agro-Energy Conference organised by the IAST, President Jagdeo re-affirmed his Government’s position on the important role which agro-energy will play in Guyana’s future. However, in late 2009, what do we have to show-off on the ethanol question? The President called for an aggressive focus on renewable energy initiatives, which included ethanol production, yet to date the Canje Project is still a dream and there is a low likelihood it will even get started in this current term. This President talks about working with partners to develop the industry, yet since 2007, 11 proposals from private, international companies are still lying on someone’s desk awaiting evaluation and this President promised that he would provide concrete answers to this evaluation process in early 2008. It is now late 2009 and no word, no deal, and minimal progress.
We have gotten almost US$1 million of IDB grant (free money) and technical support from the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) and yet we cannot make a policy decision on selecting a firm to help us develop the Canje Basin for ethanol production. The repercussions are severe for Guyana, but who cares? The oil prices are starting to rise again and the latest projection internationally is that it will hit US$90 a barrel, maybe US$100, within the next 6 months and this price rise is set to consume significant sums of Guyana’s foreign currency. More stress for the masses. However, what is shattering is that this is not the first time we have been through this developmental backward cycle but at a public policy level, we have learnt little from the last “US$100 a barrel oil price” scenario?
Guyana remains well placed to export its ethanol to the USA at a profit, but we have lost focus on that profit. Yes, the Jagdeo apologist will say that we cannot do it on our own and the global recession threw a spanner in the wheel. However, this argument is absolute rubbish since the same money and time spent on LCDS, could have been spent on raising the capital and signing the deals for renewable energy and agro-energy. This would have resulted in us making greater progress for the betterment of all the people as we face another impending oil price crisis. ECLAC calculated that if we have a 10% mix in our imported fuel with ethanol, Guyana could save at least US$5.4 million annually on fuel imports. Over US$10 million has been foregone and I have not even added on the expected saving in fuel cost if we have the hydro project in place.
We had some good suitors for this Canje Basin Project. There was the Brazilian firm (Bio-Capital) with their US$300 million project. There was the Spanish–Israeli company negotiating a US$100-million ethanol investment in Guyana. Percival J. Patterson, former Prime Minister of Jamaica representing an American ethanol company-Global Energy Ventures met with President Jagdeo in April 2007 to explore their interest in the Guyanese ethanol sector. Jagdeo told Patterson that a follow-up would be undertaken with those who expressed an interest in investing in ethanol production, to determine “which one will have the best deal for Guyana”. Two, a half years on, and he is still following-up, while the ethanol world moves on.
It is very disturbing that Guyana is one of the best-placed countries of the world to deal with delivering an ethanol product at a profit and yet to this day we continue to forego what is in the best vested interest of the nation at the expense of a personal fantasy – LCDS. ECLAC produced a very informative document called “Bio Fuel Potential in Guyana” which clearly outlines how Guyana can use available technology to leverage the excellent opportunities to make real cash and create thousands of jobs. Does the current Government plan to leverage this cash potential?
President Bharrat Jagdeo had established an Inter-Ministry/Agency Working Group on Biofuels/Agro-energy. Whatever happened to that grouping? This grouping was supposed to establish clear timelines, leading to the conclusion of the evaluation of the 11 ethanol proposals, clear the way for the financial investments and monitor the implementation of the projects. Is this body still functional and when last have they had a meeting? There were grant funds provided to set up an Agro-energy Board and provide technical support for the ongoing development of its national agro-energy policy. Bio-energy scientists were to be trained as part of a wider plan.
I know of a Zeeburg lad who works at Cargill Inc (a leading ethanol technology centre based in Memphis, Tennessee). Avinash, a former QC old boy, is a Chemical Engineer with this company and his specialisation is ethanol production and green chemistry. I suspect we may want to get chaps like these on the Agro-Energy Board to finally make some decision and make Guyana some real money rather than continue to waste valuable resources pursuing that pipe dream called the LCDS.
Yours faithfully,
Sasenarine Singh
