Viceroy’s exclusive rights to loading basin could be challenged in court - Hoyte
Stabroek News
May 18, 2002
The decision by Prime Minister Sam Hinds to grant exclusive rights to a foreign company, Viceroy Shipping, to the loading basin in the Berbice River could be challenged in court, PNC/R leader Desmond Hoyte has stated.
Hoyte told reporters on Thursday that the contract between government and Viceroy was not publicised and not even senior officials of the Berbice Mining Enterprise (Bermine) were privy to it.
He noted that the loading basin was situated in part of the country’s waterways and said the granting of exclusive rights could be against the Laws of Guyana. He claimed that Hinds had ignored the advice of the Bauxite Industry Development Company Ltd (BIDCO) board about the negative consequences for Bermine and granted the rights to Viceroy.
Armed with this monopoly position, he said, Viceroy has insisted that no ships other than its own should have access to the loading basin and mooring facilities for the purpose of loading bauxite. He stated that Bermine’s customers have rejected this since Viceroy’s shipping rates were higher than those available internationally and customers wished to have the freedom to nominate vessels of their own choice.
Hoyte noted that, as a result, Bermine’s customers had cancelled their shipments of bauxite and indicated that they would not buy more produce for the rest of the year unless the basin issue was resolved.
At a press conference on Tuesday, Prime Minister Sam Hinds had defended Viceroy’s exclusive right to the loading basin. Viceroy had previously had a silo ship there which had to be removed because there was insufficient output from the bauxite operations. In the absence of the ship, the Prime Minister said that Viceroy and the wholly state-owned Aroaima Bauxite Company still had to ship 1.2 M tonnes of ore annually from Kwakwani. With the silo ship no longer there, Hinds said that loading of bauxite ships would take twice as long and require the facilities to be available every nine days. This, he said would necessitate careful coordination of the use of the facilities. Hinds noted Viceroy’s offer to allow third-party use of the facilities utilising its ships when these were available, albeit at a higher cost. He also pointed out that Alcoa’s contract with Bermine - one of those affected by the loading basin row - had been predicated on the presence of the silo ship so there would have to be a discounting from the contract for the use of a different vessel with higher loading costs. Hinds had also denied that the loading basin dispute was the source of Bermine’s woes.
Hoyte stated that Bermine’s cash flow had been greatly reduced and the company was unable to provide sufficient fuel for its operations at Kwakwani or for maintaining regular water and electricity supply to the community.
"Given the grave crisis at Bermine and its serious impact on the livelihood of bauxite communities in the Berbice River, the PNC/R demands that the PPP/C regime take immediate comprehensive action to restore normality to the lives of people in those communities and to operations in Bermine," Hoyte stated. He requested that government arrange for Bermine’s customers to have unfettered access to the turning basin facilities on such terms as were just and reasonable.
He also asked that government ensure an emergency cash injection into Bermine to enable it to continue operations, including completing the work on the calcining kiln.
Hinds at the Tuesday press conference had also said that the situation at Kwakwani was not as dire as had been made out to be by union leader Lincoln Lewis.
Hinds, who had responsibility for the bauxite industry, visited Kwakwani on Thursday and spoke to residents there on the problems facing the industry.
Hoyte contended that the PPP/C saw the bauxite communities as being the political supporters of the PNC/R and it was not coincidental that the ruling party would not assist them. This contention has been repeatedly denied by the government.
The PNC/R leader compared the lack of action by the PPP/C towards the bauxite industry against its approach to the sugar industry.
He recalled that government had announced a US$110 million project for the sugar industry but stated the economic and financial justification for the project had not been demonstrated. "It is being wholly driven by political considerations; namely, the desire to put a large show project in the Berbice area which it regards as its geographical political constituency and, in the short run, to hoodwink sugar workers, its political supporters, into believing that it would bring them huge profits."
Hoyte said that government had set out to tell sugar workers there would be no retrenchment but pointed out that the US$12 million World Bank Public Sector Assistance Credit which government hoped to secure had a component which provided resources for training and labour market programmes. This component provides for workers in the sugar and water sectors to be retrenched as a result of the restructuring project.
According to him, some 300 workers in the water sector would be retrenched this week and sugar workers would inevitably follow.