Don’t ignore JLP’s view, Golding warns JPS buyer
BRUCE Golding yesterday cautioned Japanese trading firm Marubeni Corporation against ignoring the views of his Jamaica Labour Party (JLP), in negotiations to purchase the 80 per cent share in the Jamaica Public Service (JPS), owned by American firm, Mirant.
Golding told his post-budget briefing at the JLP’s head office in Kingston yesterday that he understood that representatives of Marubeni were in Jamaica, but that there was no contact between them and the Opposition.
“I think that it would be useful for the Marubeni people to seek our views and our ideas as to the way forward,” Golding told reporters.
Mirant’s proposal to sell its 80 per cent share of the electricity company to Marubeni for US$800 million is the latest episode in the controversy which has shrouded the company, since the government sold 80 per cent of its shares to Mirant in 2001.
At the same time, Golding reiterated the Opposition position that Mirant had taken the Government for a ride in purchasing the shares for US$201 million in 2001, and selling the company six years later for US$800 million.
Golding had included the issue in the written copy of his budget contribution on Thursday but completely ignored that section during his delivery. Yesterday, he explained that this was due to time constraints, as he tried to keep within a 150- minute schedule.
He pointed out that while Mirant had committed itself to invest US$450 million in the JPS, over 10 years, to install new power plants, the only plant installed was the US$120 million facility at Bogue, St James.
Golding said that in January, 2006, Cabinet gave Mirant the go-ahead to build a 120- megawatt coal-fired plant scheduled to come on stream next year.
“These plants take time to build. No work has yet started and Mirant is gone about its business. When is the plan to be built? Who is now going to build that plant? Is the plant going to be built?” Golding asked.
He said that Mirant had made a 100 per cent profit on the deal, having bought the shares for US$201 million and invested an additional US$200 million.
“It is said that a fool and his money are soon parted. Mirant has got the money, but we are still left with the fools,” said Golding.
He said that the government would, therefore, need to hold on to its 20 per cent share in the company to ensure that it continues to have a say in its future.
“We have to hold on to that. That’s the only little fingerhold that we have on JPS right now. If we let that go, then we would have no say whatsoever,” he said.
Finance Minister Omar Davies confirmed on April 18 that Mirant was selling its 80 per cent share to the Japanese firm, Marubeni Corporation, for US$800 million.
The Government had planned in the last fiscal year to sell its 20 per cent share to boost revenues, but this was thwarted by Mirant’s announcement that it planned to sell its shares. It now seems unlikely that the shares will be sold this year, either.
Meanwhile, Opposition Spokesman on Mining, Energy and Telecommunications Clive Mullings has suggested that a parliamentary committee be appointed to look into the issue before the sale with Marubeni is finalised.