To be closed

JISCO Alpart likely to be closed for 18-24 months, sources say ... Community/political leadership, residents show brave face

BY GARFIELD MYERS
Editor at Large
South Central Bureau

Monday, September 09, 2019

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NAIN, St Elizabeth - Up to the weekend no official word had come from Chinese metals giant, Jiquan Iron and Steel Company Ltd (JISCo), owners and operators of the JISCO Alpart alumina refinery here.

However, authoritative sources told The Jamaica Observer Central over recent days that the impending closure of the refinery, to facilitate modernisation and increased capacity, could last 18 to 24 months.

“We hope it will be shorter, but that's what we are hearing,” one source said.

A positive for local people is that a significant number of people are likely to stay on the job for routine maintenance work as well as the modernisation phase.

Early last week, Jamaica's Ministry of Mining announced in a release that JISCO had decided to “temporarily suspend alumina production (at JISCO Alpart) to ensure an efficient upgrade process”.

The mining ministry's news release gave no indication of how long the break from production was likely to last but appeared to suggest the plant would gradually shut down over the next two months.

“The Ministry of Transport and Mining confirms the second phase of the modernisation and expansion programme to commence at the JISCO/ALPART plant within the next 30 - 60 days. The upgrade will result in a significantly more efficient plant with production capacity being increased from 1.65 million tonnes per year to two million tonnes per year,” the release said.

There was no word on plans announced by JISCo and Jamaican government officials two-years-ago for a second alumina plant at Nain, conditional on the availability of bauxite reserves; as well as an industrial park producing light value-added aluminum products.

The Ministry's release confirmed persistent news reports that falling alumina prices globally and high production costs were triggering the planned shutdown even as the more than 50-year-old plant - said to be among the world's least efficient - moves into its modernisation phase.

Worker safety and welfare as well as difficulties sourcing parts for old equipment were also cited by JISCO, the release said.

It became clear last month that JISCO Alpart was winding down following the layoff of 250 casual workers and drastic cutbacks in alumina production. Reports originating within the plant also said orders had seized for vital material for alumina refining, including caustic soda.

The Ministry of Mining said it had been assured by JISCO that “it will maintain a percentage of the current workforce for maintenance as well as to assist with the execution of the modernisation and expansion programme”.

Local Member of Parliament Frank Witter and head of the Alpart Community Council Len Blake were similarly optimistic when The Observer Central made contact on Friday.

“They will have to retain a number of people for the modernisation and revamping process ... no figure yet,” said Witter, who is member of Parliament for St Elizabeth South Eastern, representing the ruling Jamaica Labour Party (JLP).

Blake, himself a former MP for the same constituency, representing the opposition People's National Party (PNP) echoed the sentiment.

“They (JISCO) are going to need a lot of people to carry out their repairs,” said Blake.

Production efficiency apart, it's expected that the modernisation of JISCO Alpart will significantly ease air and dust pollution which have consistently vexed residents in the vicinity of the plant.

When The Observer Central visited Nain last Thursday there was worry about the impending closure but also confidence that local folk will “survive” and even make progress, just as they have during previous Alpart closures in the 1980s and again between 2009 and 2017.

Julie Brown, a bartender in the New Building community to the northwest of the JISCO Alpart plant pointed to an obvious consequence of the shutdown.

“With people losing work, you know there will be less money in circulation, so less business,” she said.

And at the Dumpling Shop at the centre of Nain, operator Patsy Powell said she has had to cut back significantly on her purchases of flour and salt fish since layoffs at Alpart a few weeks back.

She showed the The Observer Central fried salt fish which had been prepared 36 hours earlier but which she would now have to throw out.

Up to a “couple of months” ago, the delicacy would have been bought within hours, she said.

With the impending shutdown of production, Patsy Powell struck a gloomy note.

“Nain water down yah now,” she said.

But across the road, her sister Junie Powell, 'the fish lady', who specialises in fried fish as well as chicken/rice lunches was defiant in the face of the expected hard times.

She recalled that when Alpart was closed in 2009 as a consequence of the global financial meltdown and spiralling oil prices of that time, she kept on going with her business.

She would be doing the same thing now, she said.

“Mi a go gwaan ping pong, just like mi always ping pong,” she said.

“This (Jamaica) a fi wi country, we can't keep depending on (other nationalities), we have to depend on ourselves,” she said.

Fifty metres away at the One Stop Bar, 53-year-old Jassett Marshall recalled the hard times in the 1980s when Alpart closed because of soaring oil prices and a depressed global economy.

She had to do all manner of jobs to raise her children, she said.

Marshall said she had to work so hard in her peanut farm, she got heat stroke.

“Doctor send me to hospital but mi go straight home because mi haffi tek care of mi pickney dem,” she laughingly said.

Marshall said that while the closure in 2009-17 also caused hardships, it was not as tough for her as it was in the 80s, largely because her children were mostly grown.

She and others survived by innovatively finding work and helping themselves, she said.

“I born and grow here... If Alpart close down mi haffi live here, if it open, mi haffi live here. Mi can't run from here, so anything dem do we haffi live...,” she said.

Almost without exception, those The Observer Central spoke to in the vicinity of JISCO Alpart on Thursday expressed sadness for young people who had bought cars using loans, after getting jobs at the plant.

“How dem gwi pay back di bank now?” asked one resident.

JISCO bought the mothballed Alpart plant from the Russian company UC Rusal in 2016 for US$299 million.

Originally built in 1968, at a time when cheap oil meant energy efficiency was hardly a consideration, Alpart had over ensuing decades become one of, if not, the most inefficient alumina refinery in the world.

JISCO and the Jamaican government apparently agreed to reopen the refinery in 2017 without massive overhaul of creaking, outdated equipment and systems, largely because of the high price of alumina - at in excess of US$500 per tonne at the time.

With the help of considerable tax exemptions and “incentivisation” from government the enterprise was apparently profitable, despite production waste said to be in the region of 30 per cent.

However, alumina prices fell drastically over the last year especially, to less than US$300 per tonne up to recently, rendering JISCO Alpart a loss-making operation.


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