The individual letters are from Mr. Winston Brassington, Chairman of BERMINE, Director of the Aroaima Bauxite Company (ABC), and Head of the Privatisation Unit. They were copied to Prime Minister Sam Hinds, who has overall responsibility for the mining sector, and Mr. Morris Stuart, Managing Director of BERMINE and General Manager of ABC.

The following are excerpts of the letter, sent to media houses on Thursday, but embargoed for publication until this weekend.

"On behalf of the new BERMINE Board, I would like to thank you for your service to BERMINE. The transition will be a challenging one for all of us, but much credit is due to the many persons of BERMINE, BIDCO (Bauxite Industrial Development Company) and Government who worked assiduously to ensure that maximum benefits can be brought to Kwakwani and Everton.

The success of this operational merger will be a credit to all. This letter seeks to summarise issues that may be important for you to understand the various benefits you will receive and what overall measures are being taken to return the BERMINE operations and communities to sustainability.

Following the visits of President Bharrat Jagdeo on June 20th and 24th last to Kwakwani and Everton respectively, two committees were formed and were made up of employees from BERMINE and persons from Government, ABC and BIDCO. The first committee dealt with the separation package that would be paid to workers.

This package was settled on June 27 following discussions between President Jagdeo and the committee. The second committee dealt with the way forward and the concept proposal of this committee formed the basis of the merger.

Below is a summary of the status of each of the major areas that deal with your benefits and the attempts to return BERMINE and the associated communities to sustainability:

Severance and Training Grant
All employees were scheduled to receive severance and training grants by last Friday via two cheques drawn on the Guyana National Cooperative Bank (GNCB).

The first cheque will represent the severance payments calculated in accordance with the Collective Labour Agreement. The second cheque represents the training grant.

Of a total of 460 workers, 80 per cent of these persons will see the total value of their severance and training grant being equivalent to four weeks pay for each year of service worked, or twice what their entitlements are as per the Collective Labour Agreements.

In total, a sum of $212M has been paid by Government to BERMINE to facilitate these payments. No tax shall be payable on the severance or training grant.

Where applicable, workers will be paid for their accumulated leave up to the date of separation, which benefit will become payable on the date of separation or shortly thereafter.

Efforts are currently under way to facilitate credit and various financing schemes that can assist housing, private business development, etc.

Persons are encouraged to bank their cheques or save as much as possible. Having cash in the bank will significantly help in providing security and being in a better position to benefit from these facilities.

Payment of NIS and PAYE not paid by company
Government will, this week, advance $18M to the Guyana Revenue Authority (GRA) and $6M to the National Insurance Scheme (NIS) representing the outstanding contributions of BERMINE to the end of July 2002, and will meet any further deficit of the company to the said authorities up to the date of separation from the company.

BERMINE'S personnel division has worked to ensure that the records of NIS and GRA properly reflect the payments of the employees during their employ with BERMINE and the company's contributions. Details on this can be obtained from ABC's Personnel Officer.

Bauxite Industry Pension Plan and Thrift Plan
On Tuesday August 27 last, the Actuaries from Bacon Woodrow DeSouza visited Kwakwani and Everton and did a presentation on the Pension Plan. Copies of this presentation will be available on request.

Additionally, a Question and Answer pamphlet has been prepared to guide you on this important subject. Arrangements are also in place for the BIPP Management Committee to visit Kwakwani and Everton again to answer any questions you may have.

It is expected that additional visits will be required until all issues on the BIPP in respect of BERMINE are settled.

As discussed, the Government is committed to paying all outstanding contributions of BERMINE relating to the Pension Plan, plus the deficit in the Pension Plan relating to BERMINE. Outstanding contributions of G$12M to the end of July will be paid by Government within a week.

The current amount of the deficit is being determined and immediately thereafter, Government will meet the deficit. At the end of 1998, BERMINE'S share of the BIPP deficit stood at G$37M.

These measures are intended to maximise the amount of funds to be made available for BERMINE employees via pension, deferred pension, or payment as determined by the Trustee, GNCB Trust.

It is expected that the final calculations on the BERMINE portion of the BIPP will not be completed until early next year. ABC shall retain the necessary personnel to ensure that all information is provided to the Actuaries.

The BERMINE Thrift Plan will also be wound up effective today. All outstanding contributions due by BERMINE will be paid on the GNCB Trust which manages the Thrift Plan.

A status report on the Thrift Plan will be available to persons interested.

House Lot Allocations
In keeping with the commitment to provide house lots to all persons who do not own house lots, the Ministry of Housing will be conducting the allocation exercise at Kwakwani and Everton prior to September 8 (today). Persons from the Ministry of Housing should have been in Kwakwani last Thursday and Friday and in Everton today to undertake the allocation.

A one-page summary of the principles and procedures is available to all employees. It should be noted that only persons without house lots will be granted house lots.

However, persons who already own house lots in Kwakwani may exchange this for one outside of the area subject to availability. The Ministry of Housing will be working with the information provided by the company in relation to this.

A total of 356 persons (189 from Everton and 177 from Kwakwani) have applied. Additionally, certain persons may be eligible for reimbursement.

Expected Cost Funded by Government for BERMINE Employees
In total, a sum of approximately $340M has, or will be expended by Government as part of ensuring that employees are provided for. A breakdown of this expenditure is as follows:
** Severance and Training Grant $212M
** Outstanding contributions for medical costs, NIS and PAYE, and un-remitted pension deductions totally approximately $50M
** Expected costs to fund pension deficit $37M
** Expected cost of house lots is estimated at $40M.

In addition to the above, certain social costs (electricity, school, hospital and water) are and will continue to be funded by the Government. Further, additional sums will be expended on improving roads and infrastructure.

Government Funding of Social Community Costs
Government has already started funding all community costs. During the months of May and June, this cost averaged $6.5M per month.

This represents the costs of electricity, water, hospital and other social costs. Electricity will be maintained by BERMINE/ABC with Government reimbursing the costs.

BERMINE/ABC will initially maintain water, under an arrangement with Guyana Water Inc. The hospital (is expected to be taken over today, Sunday) by the Ministry of Health until the appropriate administrative oversight can be agreed upon.

Persons previously employed by BERMINE, in respect of the hospital, are expected to be rehired by the Ministry by today to allow for a smooth transition. The school is already under the Ministry of Education.

Liabilities of BERMINE and Payment for Overtime
The efforts to save BERMINE and the reduction of employment are a function of market forces that have depressed sales and prices of BERMINE and the significant level of the company's liabilities. Total liabilities of BERMINE at the end of August totalled US$3.65M to third parties.

This does not include the severance pay or the training grant or the pension fund deficit.

Notwithstanding the above, a total of US$3.65M has to be repaid to third party creditors.

Secured debts of US$2.75M, which carry an additional interest cost, consist of Citibank (US$1.2M), Royal Bank of Trinidad and Tobago (US$876,000) and NBIC (US$715,000). Unsecured creditors, all of which are past due, consist of local creditors (US$516,000) and foreign creditors (US$350,000).

Production and Sales of BERMINE and Bauxite
Production from Kwakwani will cover sales for the remainder of 2002 and 2003. Total sales over remaining 2002 and 2003 period will exceed 360,000 metric tonnes of which 290,000 will be to ALCOA Point Comfort plant in Texas, United States.

Initially, ABC will provide assistance by lending ore to ensure that BERMINE deliveries can be met on time and in accordance with quality requirements.

Employment Opportunities with ABC
Those ex-employees of BERMINE who will be rehired by ABC for the BERMINE operations shall be engaged at ABC's rates of pay. These persons will be treated equally to the current ABC employees.

Subject to skills, preference will be given to ex-BERMINE employees in any future employment opportunities. In certain cases, persons may be hired initially on contract if the scope of the work is not permanent, or there is a likelihood that the position may be changed.

Socio-economic Report
In August, a group of 13 persons made up of a senior officer from the State Planning Secretariat, Ministry of Housing, Lands and Surveys, NARI, Guyana Forestry Commission, Ministry of Public Works, Basic Needs Trust Fund and Region 10, prepared a report entitled `Socio Economic Assessment, Kwakwani, Berbice River'.

The group met again on Tuesday last with the Prime Minister and agreed that an implementation plan will be prepared showing the actions and timeframes to achieve many of the recommendations. It is expected that this team will be back in Kwakwani shortly to discuss the proposed actions with the community.

The plan reviewed many areas including forestry, agriculture, marketing, credit, transportation across the river and down to New Amsterdam, housing, water, health and education.

In summary, the various players involved in bauxite and the communities will continue to be actively involved in improving the economic and social position of the BERMINE communities.