Privatisation of Wauna Oil Palm Estate holds bright prospects for Region One – Agri-Minister  

Georgetown, GINA, April 11, 2007.

Employees of the Wauna Oil Palm Estate, Region One, have been assured that privatisation of the estate will result in further advancement of their Region and will create more opportunities for them.

The announcement was made today during a visit by Minister of Agriculture Robert Persaud and officials of various agencies associated with the estate. Head of the Privatisation Unit, Winston Brassington and Director of the Institute of Applied Science and Technology (IAST) Dr. Suresh Narine were among those present.

Privatisation of the estate is expected to be completed at the end of April, at which time Agro-Supplies Technology Incorporated, a company owned by a private investor from Canada, Dwarka Persaud will be managing it.

Minister Persaud said privatisation of the estate reflects Government’s firm commitment to ensure sustainable development of the estate, job security and protection of employees’ rights.

He noted that Government, since its ascension to office in 1992 has been actively exploring initiatives that would sustain and develop troubled entities. Privatisation was initiated and a ‘White Paper’ was developed to guide the entire process so that everyone benefits, particularly the employees and the community.

 This is part of Government’s programme to diversify the country’s economic base and develop non-traditional industries in the various sub-sectors. This, Minister Persaud said is intended to create more opportunities for socio-economic development of each community and the country as a whole.

Brassington said privatisation will ensure further expansion and development of the estate. More than US$4M will be invested over the next 10 years to improve the estate’s operation.

Employees were told that they will receive all benefits which they are entitled to in accordance with the Termination Act. They will receive two weeks severance pay instead of the one week pay, which the state is required to pay for each completed year of work.

The private company will rehire persons to work at the estate but, in other skills since part of the business plan of the new management is focused on diversification. Cultivation of cash crops such as pepper and squash will be pursued and the investor has indicated that a pepper processing plant will be set up within the first six months of the company managing the estate.

There are plans to expand cultivation of palm so that output will increase while more modern mechanisms will be explored to improve production including the purchase of equipment and machinery.

Narine noted that as part of the privatisation arrangement, IAST has been contracted for one year to provide technical assistance to the estate’s management.

He told employees that the investor has agreed to set up an advisory group to represent the views of the employees, residents and all those whose lives will be affected by the estate’s operation and new management.

The Wauna Oil Palm Estate was established by the Ministry of Agriculture in the 1970s, as a pilot project to test the viability of oil palm cultivation in Guyana. The estate changed hands several times until it was transferred to the National Edible Oil company in 1985.

NEOCOL processed coconut oil and made attempts to process palm oil. However, this attempt was unsuccessful and the crude palm oil was sold to animal feed producers.

In May 2005, severance pay of more than $22M was paid to employees after the estate continually suffered tremendous difficulties and losses. Some of the workers were rehired while Government explored initiatives that could sustain the estate’s operation, ensure job security and create more opportunities for development of the area.

Private investors were invited to bid for the operation of the estate but, it was not until early 2006 that a private investor indicated his interest. Government through IAST in partnership with the investor upgraded the estate to produce bio-diesel. The National Agricultural Research Institute (NARI) and NEOCOL also supported the upgrading venture.

In July 2006, the bio-diesel plant was commissioned at Wauna and a pilot project was launched to test supply of bio-diesel to Region One. Success of the experiment resulted in a formal agreement that was signed on April 5 between Agro-Supplies and the Regional Administration for a steady supply of fuel produced at the estate.