Omai Gold Mines Limited yesterday confirmed that its proposed US$35M investment in Linmine could be in “jeopardy” because of the demonstrations in Linden this last week which have seen its operations shut down for seven days.
Already the impact of the shutdown has affected its parent company, Cambior whose shares fell by 14% on Tuesday after news of the temporary shutdown hit the international media. Cambior’s board will this week re-examine the investment in Linmine.
Omai expects to restart its mining operations by tomorrow given that protestors have agreed to open roads into the interior based on the commitment by the government for money to resurface roads within Linden. Surveyors were seen along the road commencing the first phase of the project yesterday. Omai has started recalling its workers and has begun to ship fuel into the site. Other industries including Demerara Timbers Ltd, Toolsie Persaud Limited and others have also recommenced operations.
But the Mackenzie-Wismar bridge will remain blocked until protestors get stable power supplies for over 72 hours. Electricity supplies from three 1.5 megawatt sets began at 10 pm on Tuesday night and were to be bolstered by 2.5 megawatts of additional power from last evening to satisfy the needs of the community. A Government Information Agency press release said “It is anticipated that this additional availability would provide most of the power to the Region but with some amount of low voltage during the peak hours of 6-10 pm.”
Meanwhile hauling of fuel to operation sites including Omai, Toolsie Persaud Limited and others has begun. Yesterday morning, after the five trenches dug across the roads were sealed, tankers took in fuel from the Esso Depot along the Wisroc road. The trenches described, as “scratches” by protestors were five feet deep, five feet wide and 40 feet long and prevented the hauling of fuel to these sites.
Transport of workers, food and other essential items from across the Mackenzie-Wismar bridge was also blocked by protestors and currently some 1,500 persons at Anarika and 500 families at Demerara Timbers Limited’s (DTL) operations have been complaining about lack of supplies.
Businesses over the next 24 hours may opt to ferry in workers across the river to avoid the bridge but supplies to communities would remain threatened until the bridge is opened.
The decision to open the road was taken at a meeting between residents of Wisroc, Block 22 and Blue Berry Hill and President Bharrat Jagdeo and members of the private sector where Jagdeo committed $50M to resurface seven miles of road in the community.
The road between Buck Town Creek to the One Mile Wisroc Junction through Block 22, Wisroc Road and from One Mile Junction to Phase III Wisroc are to be worked on, starting immediately.
Omai has committed the crushed stone and transportation for the project while Toolsie Persaud Limited and BK International would aid with transportation. Stanis-laus Jardine Mining would provide transportation and fuel and David Klautky & Associates engineering consultancy and Seereeram Brothers Construction would do the surveying and designs.
The surveying started yesterday and Omai, using one of its tankers, began wetting the road as an interim measure before construction. Dexter Copeland, on behalf of the concerned citizens at the meeting on Tuesday, agreed that once the works began there would be free access to the road.
But while the immediate problem of electricity and water supplies to Linden may be addressed, Lindeners face the potential of losing further with Omai’s planned stake in Linmine now coming under threat.
Norman McLean, Human Resources Manager of Omai informed the Linden community on Tuesday that their protest action was timed “terribly” and would impact negatively on Omai’s investment in Linmine.
At Tuesday’s meeting the President of Omai Gold Mines Rejean Gourde told stakeholders in the community that from the actions of the protestors it was the feeling of the company that they were not welcome in the community. “For the last year I was trying to convince my boss that it does make sense to invest in bauxite in Linden because of our relationship in the community and with everyone. So now our project is to be presented to the board in the next couple of days. Because the mine is down, because of the problem in Linden, whereas for the last couple of years I was saying that the relationship was good...... so what kind of answer are we giving the company or to the world at large?.... Based on what I am seeing we are not welcomed.”
However, residents contended that it was not that the community did not welcome Omai but they had to feel some measure of discomfort before the government and other road users join forces.
McLean said, “The point I would like to make is that we have to have reliable power...they have people already who want our bauxite because it is Cadillac grade bauxite, the best in the world. And now is the right time to do the investment because Brazil is closing down and markets are opening up.. So this is the opportunity! This is the right time to invest...so whenever we invest we have to invest in power otherwise we’ll cut our own foot and those markets would be lost.”
McLean told Stabroek News yesterday that the Board of Cambior would meet today or tomorrow and would decide on the fate of the investment in Linmine. He indicated that only Vice President of Cambior, Gourde and Luis Gigniac, Cambior’s President were supporting the investment in Linmine and the other directors were of the view that an investment in Linmine was risky given what had taken place.
“The investment is such a tremendous development for Linden and bauxite in particular. It will give longevity to bauxite production and provide for the sustainability of Omai in Guyana. The potential for growth is tremendous as Brazil is closing down its RASC operation and markets are opening up and we should be there to capture that,” McLean said.
Cambior lost US$40M of its share value in its trading on Tuesday and McLean indicated that the shareholders were bitter in their comments on the proposed investment in Guyana.
The government has been apprised of the situation and the possibility of the investment being in jeopardy.
Cambior has moved to trigger mechanisms for it to claim for political risk insurance as a result of the forced closure of its operations in Guyana. (Gitanjali Singh and Cathy Wilson)