One year after announcing plans to explore the feasibility of a setting up a multi-million dollar ethanol factory here, Ansa McAl is yet to find the right land space and the best soil and climatic conditions to plant sugarcane for the project.
The company said it was forced to turn its back on 40,000 hectares of land in the Canje Basin after its feasibility tests confirmed that the soil and rainy conditions proved the area useless for its project.
“100,000 hectares was put into consideration for an ethanol project subject to a feasibility study… In August 2012 that report informed us that the land in the Canje basin was not suitable,”Ansa McAl’s Chief Executive Officer Anthony Sabga III told Stabroek News.
“The sedimentary rocks … make the soil in that area not suitable. There is also the fact of torrential flooding… Lack of drain ability did not lend to mechanised farming… that Canje land is not suitable for us,” he observed. Sabga said that his company went ahead with the study not heeding advice from locals and technical experts that the Canje area was not suitable for sugar-cane farming and was more appropriate for rice farming.
Ansa McAl executive and manager for the ethanol project Devanand Hingoo explained that efforts to acquire a similar area of land in Guyana’s Intermediate Savannahs have so far been unsuccessful because not only did the proposed lands not meet the amount required for the project but they are broken up into different parcels rather than consolidated in one area. In addition, the company was also advised by its consultants that the land proposed was not conducive to sugarcane farming and was remote and underdeveloped. “We have been trying to get some confirmation whether government has allocated suitable land. In November a parcel of land was identified. First of all it was substantially smaller and was located in a remote underdeveloped area, set about 16 to 20km from the Berbice River,” he explained.
“Government proposed 33,000 hectares and it’s disjointed… It had no present access and would be challenging getting to and fro… The quantum and size is insufficient for the size and scale of project we want,” Sabga informed this newspaper. The company has since been informed by experts of similar conditions in the Intermediate Savannahs and are not about to make the mistake they did with the Canje Basin,” he said.
However Minister of Natural Resources and the Environment Robert Persaud in response to questions from this newspaper stated that “discussions are continuing” on 34,000 hectares of continuous land that have been located in the Intermediate Savannahs and the company has not indicated that the land offered was unsuitable.
“Ansa McAl indicated in 2012 that based on their feasibility conducted the Canje Basin was not suitable to them for the planting of sugar cane for its ethanol project. They further requested alternate land in the Intermediate Savannas. After discussions with President Donald Ramotar, the MNRE and following interactions with the Ministry of Agriculture has since identified a possible area in the Intermediate Savannas and has communicated this to the company. The MNRE has received no indication from Ansa McAl that the land is unsuitable,” he said.
“Ansa McAl has requested a minimum of 40,000 hectares of land in the Intermediate Savannas for their project. Initially the MNRE had identified two separate parcels of land. However the company rejected this stating that the land had to be contiguous. Taking into consideration existing projects in the Intermediate Savannas and forest concessions the task of identifying suitable land was tedious and time consuming since field visits had to be done. At one point a contiguous area of approximately 34,000 hectares was identified but this is under discussion,” Persaud stated.
Persaud also indicated that Ansa McAl has not to date formally submitted its feasibility study to the ministry.
The company by now had hoped to complete a successful feasibility study to point the way forward for the production of 2,000,000 tonnes of sugarcane per year for the production of 40 million gallons (nameplate capacity) of ethanol per year.
However, it awaits word from government to see if its project to pump some US$250 million to US$300 million into the ethanol plant project here would begin. “We want a suitable parcel of land that is suitable for the project in size and capacity,” Sabga said.
Guyana was selected for the exploration of the investment because of its stable currency, its experience in the cultivation of sugarcane – the crop that would most probably be used to produce ethanol – and Ansa McAl’s business record here.
Meanwhile, questioned if there were other investors who have expressed an interest in areas of the Intermediate Savannahs for ethanol production Persaud replied “Ansa McAl is the only company that has expressed a specific interest in ethanol production for the intermediate savannas at this point.”
