Development & Aid, Economy & Trade, Environment, Headlines, Health, Latin America & the Caribbean

Trinidad Scraps Controversial Smelter

Peter Richards

PORT OF SPAIN, Sep 24 2010 (IPS) - The new government of Trinidad and Tobago wasted little time. In fact, Finance Minister Winston Dookeran took less than 30 seconds of a two-hour budget presentation to announce that the People’s Partnership government, headed by the country’s first female prime minister, Kamla Persad Bissessar, was scrapping the $66.6 million dollar smelter plant project involving investors from China and Brazil.

“In addition to the health and environmental risk, there is also serious concern as to Alutrint’s viability and the optimal use of our gas. This project shall cease and an alternative strategy will be put into place for the southwest peninsula,” Dookeran said.

The proposed 125,000 metric-tonnes-per-year aluminum smelter complex had been fiercely defended by the Patrick Manning government until it was swept out of power in May. It would have resulted in the Brazilian conglomerate Votorantim Group having a 40 percent stake while the Trinidad and Tobago government held the remaining 60 percent.

China’s Exim Bank was providing the $66.6 million dollar credit facility for construction of the project, which was halted last year after the High Court ruled that the decision of the Environmental Management Authority (EMA) to grant a Certificate of Environmental Clearance was illegal. The Manning government appealed and a ruling was expected soon. But the government’s new position has now made the ruling academic.

Energy Minister Carol Seepersad-Bachan said that plants to manufacture inorganic chemicals, glass, alternative energy- industry plastics and agro-business products were likely to take the place of the smelter plant, which environmentalists said would have been highly toxic and would have affected the health of area residents.

“Despite what we have been told that the plant would have been a modern facility and safe, no one was saying how we were going to get rid of the waste generated,” environmentalist Dr. Wayne Kublalsingh told IPS.

“Because of Alutrint, residents of La Brea and environs would have to be tested for cancer every six months,” he added, referring to a 2008 medical monitoring plan by the Caribbean Health Research Council and the International Institute for Healthcare and Human Development.

Not everyone agrees. David Renwick, who was given a national award in 2008 for his coverage of energy issues in Trinidad and Tobago, said that “the fact is that aluminium smelting poses no threat these days either to health or the environment – as real experts from countries that have produced aluminium for decades have repeatedly testified.”

Health questions aside, at the parliamentary debate on the budget that ended Thursday, Planning and Development Minister Mary King said that the project simply did not make economic sense.

“We don’t own the bauxite, we don’t have alumina. It is said that we will not use very much natural gas, we are not situated in a big market for alumina products and we have no experience over how we acquired or created any of the sophisticated know-how of the industry which today is the basis of competitive advantage,” she said.

Dookeran acknowledged that the government would have to use “diplomatic and commercial solutions” to deal with some of the contractual intricacies involved in the loan arrangement and admitted that the decision to scrap the plant carried “implications”.

Alutrint’s chief executive Philip Julien said there were contractual ramifications which he was not at liberty to disclose.

“Alutrint remains committed to serving its shareholders and awaits further directives from them pertaining to the company’s continued operations. Bearing in mind the government is also the majority shareholder for Alutrint, government is in the best position to comment further on this matter at this time,” said Julien.

The smelter plant had been one of the issues in the last general election campaign. The main opposition People’s National Movement (PNM) said that the fact that it won seats in the areas where the plant would have been situated is an indication that the residents supported the initiative.

In fact, during the ongoing budget debate in Parliament, some residents staged demonstrations demanding that the government reverse its decision to scrap the project and allow for meaningful employment in the area.

“Give us the project, we have already spent so much money on it,” said one protestor, while another said that the “government joins with its environmental friends to kill the project without talking to us”.

Seepersad-Bachan says there are already prospective candidates for the plastics project and an integrated complex for a world-scale manufacture of glass and photovoltaic cells to replace the smelter project.

She said the plastics project would require an investment of $2 billion and the integrated glass and photovoltaic cells project, which requires the importation of silica from neighbouring Guyana, would require a capital investment of $2.5 billion.

“The alternative energy industry is a growing industry. It is close to $100 billion now and it is expected that the cost of solar panel will be able — in three years — to meet the cost of conventional energy supplies,” Seepersad-Bachan said, adding that there would be a “big market” for those products and would also create “significant employment” for local citizens.