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KOMENDA SUGAR FACTORY WAS SET UP TO FAIL, ALAN TELLS PARLIAMENT

Politics

The Minister of Trade and Industry, Alan Kyerematen, has told Parliament that the Komenda Sugar Factory has lain idle since it was commissioned by the John Mahama-led government on May 31 2016 due to serious deficiencies in the planning of the project.

The Minister of Trade and Industry, Alan Kyerematen, has told Parliament that the Komenda Sugar Factory has lain idle since it was commissioned by the John Mahama-led government on May 31 2016 due to serious deficiencies in the planning of the project.

According to the Minister, other problems facing the factory are its financial, technical and legal challenges.

Technical audit

Mr Kyerematen told Parliament that given the enormous difficulties associated with the project even before it came into office, the NPP government commissioned a technical audit of the factory in September 2017 to ascertain its technical and operational status.

He said the findings of the technical audit revealed that a test run was never completed before the factory was commissioned, due to non-availability of sufficient sugar cane for the run.

The Trade and Industry Minister was answering questions posed by Dr Samuel Atta-Mills, MP for Komenda/Edina/Eguafo/Abirem. He wanted to know why the Komenda sugar factory had been shut down and what the government was doing about the matter.

Component deficits

The Minister said that on commissioning, the factory was not in a position to produce the required white refined sugar due to an absence of processing component units, which were not fully installed during the test run. These included melt clarification units, vertical crystallisers and a dosing system.

He added that overall, about 35 items had not been installed on commissioning, though these were critical for production of sulphurless white sugar.

Mr Kyerematen said that, to add insult to injury, the land available for cultivation of inputs was far less than the 6,000 acres required to supply sugar cane to run the factory at full capacity.

He also pointed out that there was no outgrower scheme developed for small-scale farmers to support a nucleus plantation for the factory.

Abortive divestiture

Moreover, the audit revealed that generally the soil condition in the factory’s catchment area was not favourable and required significant application of both organic and inorganic fertilisers to improve yields.

“The previous government, in late 2016, went through a process of divesting its majority shares to a private investor.

“However, the process was aborted due to the failure of the identified investor to fulfil the obligations under the sale and purchase agreement,” Mr Kyeremateng said.

NPP intervention

He said that the ministry, in an effort to put the factory to viable commercial production, however decided to initiate a new process in collaboration with the transaction advisor, PricewaterhouseCoopers, to attract a strategic investor to acquire the factory assets and manage the company’s operations.

So far, he said, he was pleased to announce that the bid evaluation process has been completed by the transaction advisor and a recommendation has been made for consideration by the ministry and cabinet.

Alan Kyerematen assured the House that the final decision in respect of the matter will be taken by the end of this month.