The government announced on Friday that it is assigning the management of Linmine’s production operations to the Canadian mining company, Cambior, the parent company of Omai Gold Mines Limited, with effect from August 1.

The remaining workers at the bauxite company will be dismissed with various termination benefits while a portion will be rehired.

The Bauxite Industry Development Company (BIDCO) will also be wound up effective August 1.

Prime Minister Sam Hinds in a statement issued on Friday said that he “continues to believe that the steps being taken now are in the best interest of past and current workers in Linmine and Bidco and the related bauxite communities, and hold real promise for a successful, refashioned and profitable bauxite operation in Linden.”

He urged the workers being terminated to see their “termination and self training monies as sacred to self and community development.”

Prior to Hinds’ statement, the PNCR had criticised the transfer, saying that there had “been no consultation with the PNCR, the unions, the Board of Bidco and/or the Board and management of Linmine. All the decisions have been made by the Government and imposed on the management and employees of Linmine with little or no consideration for the severe social and economic dislocation which has and will befall the Linden community.”

It said that, “the President and Cambior have had ample opportunity to disclose their intentions to the Leader of the PNCR, Mr Robert Corbin, MP. The information available to the PNCR confirms that the President was already at the point of decision when they (Jagdeo and Corbin) met, on Wednesday 2003 June 18, and discussed the issue of the Establishment of the Committee to Prepare a Comprehensive Development Programme for Region 10. The failure of the President to inform the Leader of the PNCR is evidence of his intention to act unilaterally even though the opportunity for consultation was available”.

The release pointed out, “Without any investment in Linmine, Cambior-Omai will take over the total operations of Linmine, including bauxite processing, marketing and shipping, from 2003 July 1. The Government will, in addition, give Cambior-Omai US$ 0.5M for working capital.”

A release from the Office of the Prime Minister, detailing the steps being taken, said that by June 30 Linmine will serve notice to every employee “of the termination of (their) employment by July 31, and information would be provided “in good time on the quantum of termination benefits, the date time and procedure to receive same etc.”

Hinds’ release added that the government would appoint by August 1, a new reconstituted interim Board for Linmine designed for current tasks’ and that “to meet evident needs until they would have been phased out, Linmine will establish a small secretariat to manage the OBC contract and other related party matters; outstanding and residual matters such as former employees’ records for Pensions, NIS and PAYE; properties movable and immovable of Linmine; accounts receivable and payable which Limnine may handle directly...”

It added that a Special Purpose Subsidiary Company mandated to provide electricity on behalf of Linmine as the de facto public utility in the Linden area, and other residual, historical services which Linmine may continue to provide” will be established.

Prime Minister Hinds told Stabroek News that the government had not given thought to the subsidiary company’s relationship with the Linden Power Company, which was put into receivership by the Republic Bank of Trinidad and Tobago.

The new arrangement resulting from the merger of the state-owned Aroaima Mining Company and the Berbice Mining Enterprise has implications for Bidco, the holding company for the three bauxite operations. Prime Minister Hinds said that Bidco was being wound up.

The statement from the Prime Minister’s office said in relation to Bidco, that “it has been steadily downsizing its operations” and “the remaining eleven employees will be put on notice of the end of their employment by July 31, 2003.”

“The Bidco Board is reviewing the various functions and responsibilities of the company and will recommend the transfer of these responsibilities to the Government Agencies best equipped to handle them.”

In their initial proposal for acquiring a majority share in Linmine, Cambior indicated that it would be reducing the workforce to 400. Linmine’s workforce at the time the decision was taken to privatise, stood at 1200.

The 400 will be recruited from the laid-off Linmine workers.

When Omai was awarded the stripping and mining contract, a number of workers were laid off or accepted voluntary redundancy.

The PNCR statement also accuses the government of unilaterally and progressively handing over the management and control of Linmine to Cambior despite its “inability to deliver on any of the primary commitments which it made in the Memorandum of Understanding (MOU) of June 6, 2002 for investment in the equity of Linmine.”

Stabroek News understands that Cambior put the proposal for the greater management role to the government several weeks ago but was yet to receive a formal response. Stabroek News was unable to reach Norman McLean, Omai’s Human Resources Manager, and his office said that he was out of the country. So was Rejean Gourde, Omai’s General Manager and a Cambior Vice-President.

The statement from the Prime Minister’s office explained that the steps were being taken to ensure that the major benefits of the proposed partnership were achieved whilst the total financing was being pursued. A Bidco official told Stabroek News that the “takeover” was prompted by a slippage in the Linmine processing operations, which had resulted in a devaluation of its customer base.

The official said that the stripping and mining operations, which Omai was carrying out, were going well and because of that something had to be done about the processing operations.

The official added that the longer than anticipated time Cambior was taking to raise the proposed US$20M financing for Linmine from the international financial institution was another consideration. Another official explained that investors were unwilling to put money into high risks ventures at this time.

The other option was to allow the Linmine privatisation to lapse but the official said that was not a feasible one.

Government has embarked on the privatisation of Linmine because of the continuous losses it has been making and the consequent drain on the Treasury.

Under the proposed restructuring of Linmine, Cambior will acquire an 80 per cent stake with the government retaining the other 20 per cent. Cambior is to inject US$20M in new capital.

Cambior also plans to operate with a greatly reduced workforce and introduce new stripping methods as well as to introduce new products through some strategic alliances.

After Alcoa pulled out of its joint venture with the government in the Aroaima Mining Company last year, the government was forced to wind up the operations of the state-owned Berbice Mining Enterprise and merge its operations with that of Aroaima, with Aroaima management having the overall responsibility for the restructured company.