Montague says vital assets burnt in Jamalco fire
Minister of Transport and Mining, Robert Montague (File photo))

Minister of Transport and Mining, Robert Montague, says that vital assets were destroyed during the fire at the Jamalco alumina refinery in Clarendon in late August.

He said that currently, the refinery's losses are estimated at US$500,000 per day, based on Jamalco's production cost of US$150 per ton of alumina at a production rate of 3,170 tons per day.

“The company has already submitted a claim of US$150 million for business interruption, which is expected to meet its monthly expenses for 10 months, out of an estimated 18-month period of care and maintenance of the property,” Montague added, in a statement to the House of Representatives, on Wednesday.

He said the fire has caused alumina production to stop, which will have a very negative impact on the company, and the wider economy.

“There will be a decline in alumina production and the related foreign exchange earnings for 2021, into 2022 and possibly into 2023. This is already having a direct effect on the finances of Clarendon Alumina Production (CAP) Limited, as the company will not earn any income until alumina production resumes,” Montague noted.

He said, however, that Jamalco has property and plant insurance coverage amounting to US$250 million, to address single incidents such as this fire. In addition to property damage, the insurance policy covers extra expenses and business interruption.

He also noted that as an immediate action, Jamalco is making every effort to retain its staff, including direct employees and contractors.

“Currently, mining contractors are working three days per week. Contractors involved in mothballing, which is the process of protecting the undamaged assets until they are ready to be used again, are winding down their activities. Additionally, residue storage area contractors for dyke repairs will be engaged over the coming months,” Montague said.

BY BALFORD HENRY Senior Staff Reporter

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