National Energy Corporation officials Vijai Lal, left, senior project engineer, and John Jones superintendent of engineering design and construction, speak during an interview with the Business Guardian last week.

Photos: Dilip Singh

Stories by Sandra Chouti

Civil engineer Prakash Saith remembers all too well the long days he and other professionals like him spent to develop Point Lisas as an industrial estate.

“I came out here as a student engineer when they were just filling the site. It took a few years to fill it, because it’s very, very poor soil there,” said Saith, now president at the National Energy Corporation (NEC).

“I worked here when they were creating this estate in the 1970s.”

“I was outside taking sun in 1974/5 when they were filling the site, when it was mangrove and sea,” he said. “We created 4,000 to 5,000 permanent jobs. Twenty world-scale plants. When we started, we had nothing.”

Saith still remembers the hardship of those days.

“When I used to come in here to work, in those days, you used to take taxi. I had no car and thing. I didn’t even have a licence. The taxi used to drop me by the roundabout. I used to have to walk in from the roundabout to where Iscott was. Sometimes the soil was so bad, you sink up to your waist.”

“You had to work in pairs. Alligators were running around the place because it was swamp,” Saith said.

Point Lisas developed incrementally.

The port, which existed initially to service the export of sugar, was upgraded to suit the needs of the petrochemical sector.

The power plant was installed in 1980.

And the Iron and Steel Company of T&T (Iscott), now known as Mittal Steel, started in 1982.

Saith said the industries at Pt Lisas “weren’t zoned in an optimum manner.”

He said, though, that the new industrial estates being developed will be zoned.

“In fact, Union Estate, we have zoned it to suit the environment and to suit safety, certain things we’re trying to implement in all the estates—bigger corridors, because when you make your products, you’re trying to get it to the port via pipeline or conveyor. If it is a liquid, through a pipeline, if it is a metal, through a conveyor system. Everything is for export.

“We need to design corridors a little wider now,” Saith said.

New estate for Point Lisas

Pt Lisas industrial estate is not being expanded. Rather, a new one is being built.

So says Saith, whose offices are based at the corner of Factory and Rivulet Roads, Brechin Castle, Couva.

He said the NEC has ten criteria before it chooses a site for industrial development, including:

n the land must be of suitable size

n the area must be 1,000 acres and more

n it must be State-owned

n it must be close to a port

n it must have minimal land use on it

n and, it must have utilities you can expand

“Based on those criteria, we go out and look for sites. We found six sites. Some of them have pluses and some have minuses. We make a recommendation—this is the best, this is second best, this is third best—based on technical criteria,” Saith said.

Saith, the younger brother of Energy Minister Dr Lenny Saith, said government last year agreed with its recommendation of three sites:

n Pt Lisas south and east, 1,400 hectares

n Oropouche, 1,400 hectares

n Chatham, 1,100 hectares

“A total of 3,800 hectares, which is 10,000 acres of land, so that could take us to the year 2050 for industrial use,” Saith said, in an interview at the NEC last week.

The other three sites considered were:

Pointe-a-Pierre, which was dismissed for lack of space; Galeota for the sea blast, not having infrastructure and no large quantities of water and power, and Cedros, for lack of infrastructure.

“These things are very expensive to develop, so you identify what you want and you land bank it.

“You land bank the three sites for development from now to 2050. You use it when you want it, but you prevent people from going there. You kind of reserve it,” he said.

Vijai Lal, senior project engineer at NEC, said the new estate in Couva will comprise 1,400 hectares and be bounded by Rivulet Road in the north, Claxton Bay in the south, the Solomon Hochoy Highway in the east and the Southern Main Road in the west.

“In that region, when you exclude the existing houses, existing development and existing institutional facilities—Powergen and UTT and Sevilla House and parcels that have been allocated and the sand mining quarry, we are left with 1,400 hectares or 3,700 acres of unencumbered lands to locate industries,” Lal said.

The “second wave” of industrial development will be bigger than Pt Lisas, which is 800 hectares.

“Pt Lisas has accommodated about 20-plus world-scale industries.”

“These are normally what is referred to as primary industries. They are into the first level of manufacturing and they require small sites ranging from between 20 and 30 hectares.”

“When we talk about the estate at Pt Lisas, and the expansion we are looking at for downstream industries, you are talking about parcel size between five and ten times the size for Pt Lisas”

“You are talking between 100 and 200 hectares for one industry,” Lal said.

One of the gas-based industries set to go down in the new estate is the India-based Essar Steel.

John Jones, superintendent of engineering design and construction at the NEC, said, “In the next few months, we are going to build the Essar steel plant, build the estate, build port facilities for this plant.”

Jones said Essar wants to begin importing raw materials by December 2007.

Essar Steel plans to begin manufacturing such products as direct reduced iron, hot roll coils and slabs three months later.

“We are working full speed ahead. We are multi-tasking right now,” Jones said.

NEC, which has been given the mandate by government to do the business development for the energy sector, will be constructing five ports for the various industries to come on stream.

“We’re going to build about five ports. And we estimate that those five ports could cost probably in excess of $1 billion or less than US$200 million.”

“We’re going to build two at Brighton—one for the petrochemical plant and one at Cap-de-Ville/Chatham for the Alcoa smelter, then we’re going to build one at Pt Lisas for Essar, and we’re looking at one at Galeota. We’re going to expand facilities owned by bpTT,” Jones said.

Lal said in developing the energy sector, the supply chain logistics associated with bringing oil and gas from offshore require a dedicated port.

Pt Lisas port is scheduled to start construction on its expansion later this year.

Jones said the “first wave” of the first industrialisation process used natural gas to produce primary material—producing steel, ammonia, methanol.

“We did that successfully for about 25 years, so now we have reached the stage where we want to go further, and we are going downstream now,” he said.

As part of its own expansion, NEC has cleared a five-acre parcel of land next door to its building that is bounded by Rivulet and Factory Roads at Brechin Castle to be used as a carpark initially. It’s expected that office space for energy-type industries already operating at Pt Lisas will be constructed on that space.

Alutrint construction starts in August

Alutrint Aluminium Complex

A certificate of environmental clearance for the construction of the Alutrint aluminium smelter is expected in July.

Prakash Saith, president of the National Energy Corporation, which has the mandate to develop new industrial estates, said construction of the Alutrint smelter is expected to begin in August.

Saith, who said the feasibility study for Alutrint was “very positive” using Chinese technology, which is more cost effective than western technology.

Using Chinese technology—gami—will complement the NEC’s application to borrow US$400 million from the China Exim Bank.

“We have a proposal to get very attractive terms,” Saith said. “We have to put the other 30 per cent—US$140 million. We have been told it has been approved because it’s a kind of government-to-government arrangement.”

“They are very facilitative, very proactive and very professional. Their engineering has been up to mark,” Saith said.

He said the Chinese want to export this technology to “show the world Chinese technology could work in western cultures.”

Saith said none of the 125,000 tons of aluminium Alutrint will be producing annually will be exported, but will be used locally.

“Every pound of it will remain in Trinidad to add further value downstream. That is the advantage of the Alutrint project. Nothing is being exported as aluminium. All exported as finished product,” Saith said.

He cited motorcar rims and electrical wires for cable as examples of the use to which the aluminium will be put.

No $$ for polluters

Funding agencies would not finance projects which have environmental problems, said civil engineer Vijai Lal.

Lal, senior project engineer at the National Energy Corporation in Couva, said: “You can’t develop an estate and exclude the environment.”

For instance, NEC, working in partnership with State-owned Petrotrin, began the process of abandoning and capping 67 wells at Union Estate in La Brea in April 2004.

“We took all the contaminated soil, excavated it. Basically, you exhume the contaminated soil and you replace it with uncontaminated soil,” Lal said.

“Well abandonment was $24 million. That work was done based on local consultancy services. It was vetted by international consultants so it was acceptable and funding agencies could be satisfied,” he said.

He said there is a responsibility in leasing a site to a developer to demonstrate it has been brought to a certain level of acceptability—the constituents of contamination have been identified and it has been remediated to the acceptable levels—to satisfy investors’ demands.

Waste from Union Estate was taken to a remediation yard in La Brea that was built for oil waste.

“That type of soil could have an effect on the ground water,” said John Jones, superintendent of engineering design and construction at NEC.

Alcoa decision next month

The head office of the National Energy Corporation on Rivulet Road in Point Lisas.

Alcoa Inc is expected to make an investment decision to set up a plant in Trinidad by July.

“Their board will ratify it. Right now they are doing a feasibility study—if it makes sense,” said Prakash Saith, president of the National Energy Corporation (NEC).

“If positive and their board approves of it and the government of T&T approves it, they will start construction by the first quarter of next year.”

The Alcoa plant, to be built at Chatham, is three times the size of the Alutrint aluminium smelter, which will be located at Union Estate in La Brea.

If Alcoa becomes a reality, it will be producing 431,000 tonnes of aluminium a year.

NEC made $64 million in 2004

The National Energy Corporation (NEC) made $64.2 million in profit after tax in 2004.

NEC president Prakash Saith said, “Last year, the NEC for 2004 made about $3 million profit per employee.”

He said NEC’s revenue is close to $200 million, most of which comes from use of its port.

Saith runs a tight ship.

“Any ship that comes in here, I charge them to use my harbour. That brings about $35 to $40 million a year.”

“To use my harbour, you have to use my tugs, because it is a compulsory tuggage area.”

“I charge you to use the tugs, that’s another $40 million a year.”

“I charge you to use my piers. That’s another $70 to $80 million,” he said. “I don’t think even private enterprise makes that kind of money. We keep a low profile, though.”

He said NEC showed its first profit in 1993.

Saith said industrial estates normally don’t show profits before ten years of operation because all the costs are sunken costs upfront.

“In Labidco, we made our first profit after four years of operation. We have made our fourth consecutive year of profits. Last profit was small, about $4.5 million, but at least we’re on the profitable side,” Saith said.

“We made our first profit six years in advance and we have made a profit every year since.

“We have 16 land tenants, we have a port that people use very heavily. We have bio-remediation services.,” he said.

Another source of revenue is the building of platforms.

“For the first time in T&T, we are building platforms locally. We have been importing platforms for the last 50 years. In fact, right now we are building three platforms in Trinidad, one for EOG that we will ship out on June 14, and bp is building two. Three platforms, creating a tremendous amount of jobs,” Saith said.

He said NEC generates its own revenue and either uses its own funds for new projects or sources funds on its own.

“When we were building our piers, we borrowed money. If the project is small enough, like this building, we funded it ourselves.”

“The tugs we buy, we funded them ourselves. We go out on the strength of the project and get a loan,” he said.

“Our job is to build those piers and to maintain those piers 24/7/365.

“We have been in operation for the last 28 years and our ports and harbours have never been closed. That is no mean task.”

“We have a world class standard. Which port in the world could boast about that? None.”

Asked what’s the future of sugar production, Saith said he’s not an expert on the subject of sugar, but he understands that the cost of making sugar is six times the world price.

“In Guyana, it’s less because the labour cost is less,” Saith said.