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The bauxite industry revival

Lance Neita

Sunday, June 25, 2017

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Mike Henry named it “Revival time again”. The mining minister could hardly contain his delight as he spoke at the reopening of the Alpart alumina plant in St Elizabeth on Wednesday last week. He even did a little revival jig — for which he is famous — when he described how the positive impact of the reopening is being felt in the economies of St Elizabeth and Manchester: “The hotels and guest houses are full and reporting increasing occupancy, shops, farm stores, bars, supermarkets, and other establishments are bustling.”

I attended the ceremony and there was definitely a feeling of rebirth and rebuilding with employees both expectant and optimistic about a future that for nine years had looked like a very dim prospect for any form of restoration.

The car park was full, an indication that jobs had returned and that the old lady of the Essex Valley had been brought back to life. The reopening of Alpart and the renewal at Noranda/New Day in St Ann has breathed new life into a bauxite/alumina industry that has been challenged by some devastating curved balls thrown its way in recent years.

The recession of 2008 dealt a body blow to the industry from which many felt it couldn't recover. The recession resulted in the closure of Alpart, Windalco Kirkvine, and Windalco Ewarton, throwing the Jamaican economy into a tailspin as it tried desperately to recover ground over the next few years. Trouble loomed again in 2016 when the Noranda Bauxite plant lost 50 per cent of its market volume and sank into bankruptcy with the possibility of a plant closure as a very real threat.

The saving grace for that company was DADA Holdings LLC. DADA, a new industry player, purchased the ailing operations in October 2016, thus saving 800 jobs and putting the 50-year-old plant back on its feet.

The closures of Alpart, Kirkvine and Ewarton in 2008-09 brought grief to thousands who depended on the companies for income, water, educational assistance, road improvements, sports and youth development, and charitable medical assistance where possible.

Then there were the lights. A favourite advertisement of Alpart during its heyday read, “The lights of Alpart glow with a radiance reflecting the heart and soul of a city that never sleeps.” This was in direct reference to the night view one got of the Alpart alumina plant as you ascended the Spur Tree Hill roadway and looked down to the valley below where a thousand lights formed the shape of a Jamaican map and seemed to make the plant glisten in the dark.

For a while we thought we would never see that landmark again, but now, with the press of a button and the declaration statement from the prime minister at Wednesday's reopening, the powerhouse has taken on new life, sending the alumina stream coursing through the pipelines and generating the return of the famous night lights to the valley.

St Ann, too, had its fair share of concern in 2016 as the fate of its bauxite company hung in the balance and the parish geared itself to face life without bauxite. Interestingly, although the operations has had its own share of mixed fortunes over its 50-year life cycle, this is the only bauxite company that has never closed its doors in Jamaica, not even once. Close to it, yes, with a three-month strike in 1975, sharp reductions in production, and the bankruptcy scare in 2016, but the company, which many still call Kaiser Bauxite, has continued to soldier on where others have faltered and closed, suspended their operations, or just walked away.

On Wednesday the Henry spoke positively about the future: “Mr Prime Minister, given the proposed expansion of Alpart, RUSAL's new plans to rehabilitate, construct and reopen Kirkvine, Jamalco's new power plant to come on stream, and New Day's expansion of their mining areas, we want to give you growth contribution to GDP of close to 40 per cent over the next few years.”

So it looks like the future is here. The bauxite industry, like many other industries, moves on a cyclical path. Let's take a look at the past. The history of industrial activity within the sector started in 1952 with the shipment of Reynolds' first bauxite cargo on June 5 of that year. But the story of the industry began much earlier when the occurrence of bauxite in the 'red soils of Jamaica' was first confirmed from tests done between 1938 and 1942 by R F Innes, who was an agricultural chemist in the Department of Agriculture.

In those days the red soil was a subject of ignominy for people who lived in those areas. I remember residents from my area mockingly referring to individuals from Mocho Mountains, who came down to the plains, as “Mocho Red dirt” men.

The red dirt, which took up so much useless acreage, provided much debate and were naturally the subject of much scientific and agricultural investigation. Innes must have been something of a comic character to the rural country folk as he went around collecting samples of the soil for what purpose they knew not.

But he was not just snooping around. He patiently carried out his tests in Grove Place in Manchester and Bull Savannah in St Elizabeth on behalf of the Government. He then crossed over to Lydford in St Ann at the request of property owner Sir Alfred DaCosta, who had reported difficulty experienced in establishing wynne grass and corn on his extensive holdings.

His search was not fruitless. When he analysed the deposits back at the government lab in Kingston he found that the soil contained aluminium to the extent of between 45 per cent and 51 per cent. This was a major breakthrough. It was now possible to inform Sir Alfred that his red Lydford soils were really 'low-grade bauxite'.

DaCosta proved to be a shrewd entrepreneur, sensing that he had acres and acres of 'red gold' on his hands. He immediately launched a vigorous search for prospective developers from overseas aluminium companies.

Aluminium Limited of Canada (later processing in Jamaica as Jamaica Bauxite Limited and then Alcan Jamaica) was one of the first companies to respond. They gained exploratory rights from the colonial government as early as 1943, and by 1946 had acquired some 29,500 acres of bauxite property.

On an interesting historical note, the year 1943 saw the first shipment of bauxite from Jamaica when Aluminum Laboratories (later Alcan) made a test shipment to St Louis in the US of 2,300 pounds of the ore for testing.

The bauxite was mined by hand, with men using pickaxes and hand shovels to package the ore into 'stout paper bags' sent to Kingston by rail to be shipped from Railroad Pier No 3.

In the meantime, Reynolds Metals, the second company to arrive in Jamaica, secured options on 15,000 acres by November 1944 and pressed on with plans to build a drying and shipping operation in St Ann.

Those earlier purchases capitalised single, large landholding and left the third pioneer company, latecomer Kaiser Aluminum, with the difficult job of surveying, mapping and purchasing or optioning numerous small parcels across the St Elizabeth, Manchester, St. Ann and Trelawny.

The years 1952-1953 were active years for bauxite in Jamaica. Reynolds shipped its first bauxite commercial cargo on June 5, 1952.

Alcan made its first alumina shipment from Port Esquivel in 1953 and, on February 9, 1953, Kaiser made its first shipment of bauxite from Port Kaiser — 10,000 tonnes on board the SS Evanthia,bound for Kaiser's Baton Rouge alumina plant in Louisiana.

Since 1953 there have been a number of dynamic changes in the ownership and structure and construction that moved across the face of the industry. At first the three pioneer companies — Alcan, Reynolds and Kaiser — integrated themselves in to the economic and social fabric of their communities and Jamaica. Then came that surge of expansion in the 1960s powered by then Minister of Trade and Industry Robert Lightbourne, with the opening of Alcoa, Revere, and Alpart.

In 1962 the Government had signed a 25-year agreement for mining bauxite in the Mocho Mountains of Clarendon. This was followed by the announcement in 1968 to build the alumina plant at Hayes, Clarendon, which was completed in 1972.

Kaiser transferred its operations from St Elizabeth to St Ann, building a giant industrial complex which went into operation in January 1967. Alpart, a consortium of three companies — Kaiser, Reynolds and Anaconda — went into production in St Elizabeth in May 1969, and made its first alumina shipment in August 9, 1969. And the Revere alumina plant was constructed at Maggotty in St Elizabeth and went into production in 1971.

Other players have made significant investments into Jamaica. These include United Company RUSAL (UC RUSAL) Glencore International AG, Century Aluminum, and Noranda Inc. AC RUSAL created a significant name change for Alcan when they bought the company and transformed its locations into Windalco Kirkvine and Windalco Ewarton.

The Alpart partnership brought in Hydro Aluminum to partner with Kaiser Aluminum on their reopening in 1989 after being closed for three years.

There have been other joint ventures, JAMALCAN, a partnership between Alcan Jamaica and Jamaica Bauxite Mining Limited (JBM), and the JAMALCO Joint Venture first exercised with JBM and later Clarendon Alumina Production (CAP). Jamalco is now a venture between the Noble Group and CAP.

The Jamaica Government has also created major players in the industry, Jamaica Bauxite Institute and BATCO, its bauxite and alumina trading arm. CAP, wholly owned by the Government, and JBM.

Recessions have also taken their toll on the industry. Recessions led to the closure and departure of Reynolds on February 28, 1984, and the departure of Alcoa February 6, 1985 (it returned in 1988). Revere had long before closed its shutters on August 19, 1975. Alpart also closed its doors in 1985, but reopened in 1989.

Once again the industry appears to have weathered another crisis period. The historical canter that we have just been through provided us with dates and checkpoints surrounding events as they unfolded over the life of the industry. But the other side of the story is still to be told in another article which will feature the magnificent contributions that have been made to national development in safety, education, training, community assistance programmes, and other partnerships.

Lance Neita is a public relations writer and consultant. Send comments to the Observer or lanceneita@hotmail.com.

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