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Opportunities for development of a “Sugarcane” Industry

Sugarcane as an Energy crop

Harold Davis and Paul Hough April 2006

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Prevailing Conditions

Caribbean Sugar Industries characterised by high cost

Old Technologies, small factories and relatively high wages

Traditionally dependent on preferential prices for raw sugar

Significant price reductions from EU, the main preferential market

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Future of Sugarcane in the Caribbean

Raw sugar production can no longer sustain an economically industry

Exploit the total biomass of this unique crop

Electricity generation and ethanol will become increasingly important outputs from sugarcane production

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Features of Guyana Industry

With a production capacity of 320,000 tonnes at unit cost 18¢ per pound sugar, the Guyana Sugar Industry is probably the most competitive in the SAC group

This Industry is also challenged by the new market prospects arising from the EU cuts

Guysuco has developed a long term strategic plan for cost reduction based on expansion and improved efficiency.

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Guysuco-Strategy-1998

Expand Industry & Diversify Product Base Construct new 8400 tcd mill – to produce refined

sugar with co-generation of 10MW electricity Possible joint venture potable alcohol distillery at

new factory Increase yields and reduce production costs on

remainder of industry By 2010 sugar output 450,000 + tonnes

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Strategy Implementation

Strategy revolves around reduction in production cost to 12¢ per pound sugar

Cost of operations largely dependent on labour intensive cane cultivation and harvesting

Progress made with layout modification and reducing operating costs by increased mechanisation of agronomic practices

Collaborating with WICSCBS in variety evaluation for energy and other potential uses

24 MPC varieties being propagated

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Characteristics – DB 9633

DB 9633 DB 7869

120 tc/ha- Pl+2R 125 tc/ha – Pl+2R

Pol% cane – 13% - 14% Pol% cane ~ 12%

Fibre% cane – 16%-18 % Fibre% cane – 14% - 16%

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Skeldon Project Milestones

1999-Commence land development for new sugarcane project at Skeldon

2001-Booker-Tate appointed Project Manger 2002 -World Bank clearance for financing 2003- EIA and Env Permit approved 2004 – Agreement for cogeneration component with Power

Company and Financing bank 2005- Env Management Plan approved 2005- Factory Contracts signed 2006- Commence Factory Construction

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Features of Skeldon Project

Net sugarcane cultivation to increase from 4270ha – estate and 310ha –farmers to 8700 ha – estate and 4250 ha farmers

Factory capacity 8400 tonnes cane per day Crop duration 27 weeks net! At steady state design capacity for 1,170,000 tonnes

cane and and production of 110,000 VHP sugar

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Features of Skeldon Project contd.

First diffuser in SAC industries Rum distillery under consideration as joint venture

with Angostura Ltd. Factory will export 10MW to grid under firm power

agreement Feasibility study and negotiations for refinery as

joint regional venture in progress Refinery may be sited at alternative Berbice factory

given Skeldon’s commitment to grid

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Cogeneration Plant Equipment

Two 125 tons/hr Boilers operating at 53 Bar and 485ºC

Extraction/Condensing T/A output 15MW Back pressure T/A output 15MW Three Diesel Alternators combined output

10MW Heavy Fuel Oil for Diesel Alternators

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Plant Operating Features

Sugar factory power - 9900 kW Process steam - 168000 kg/hr Cogen plant load - 2700 kW Cogen plant steam - 5700 kg/hr Bagasse prod @ 34%cane 400000 t Bagasse consumed in crop 320000 t Bagasse storage 54000 t

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Skeldon Cogeneration operation

Projected 10MWexport power from bagasse fired boilers for 37 weeks to 40 weeks including 10 weeks out of crop from stored bagasse

Projected 8MW export power from Diesel alternators when bagasse stock exhausted

Supplementing stored bagasse with imports from Albion will extend out of crop generation period

6 week window of opportunity for fuel/mpc cane to supplement fuel supply to plant after juice directed to distillery.

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Energy Content of Sugar-cane (Guyana)

1 Tonne Cane110 kg sugar 1800MJ170 kg stalk fibre 3100MJ140 kg top fibre(trash) 2600MJ Tot. 7500MJ1 tonne cane approx. equivalent to 1 barrel of oil

(ex Dr. M. Regis Leal -2003)

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Fuel Potential of Sugarcane

Potential for leaves and tops to contribute to boiler fuel

These should be removed prior to process for efficient extraction of sugars and fermentables

Cellulosic materials associated with alkali and alkaline earth ions which can induce slag formation and reduce boiler efficiency

Bagasse has advantage over other cellulosic fuels because extraction and washing removes significant amounts of alkalis and alkaline earths

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Meeting electrical requirements with back-pressure turbogenerators (at constant steam demand)

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Electrical self-sufficiency (100 %) and generation of excess power for export (above 100 %)

150%

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85 bar, 525°C

60 bar, 500°C

40 bar, 450°C

30 bar, 400°C

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23 bar,

350°C

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Power Characteristics –Integrated Factory with Annexed Distillery

Front end consumption - 21kwh/t cane Process consumption - 8 kwh/t cane Pot export @45 bar 444°C - 92kwh/t cane Pot export @ 82 bar 525°C - 143kwh/t cane Distillery consumption ~ 4kwh/t cane

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Cogen Potential 4800TCD Case Study

Cane Production -``````926100t5MW Plant - 47kwh/t cane10 MW Plant - 95kwh/t cane12 MW Plant - 113kwh/t cane15 MW Plant - 142kwh/t caneImplies a 15 MW facility can probably be supported

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Possible Sugar & Ethanol Production - Guyana Pol% cane 11%, Purity 81%

Standard Process – EtOH from final molasses only- sugar – 9% cane, EtOH – 10l/t cane

A strike only – sugar – 6.1% on cane, EtOH – 25l/t cane

A & B strike – sugar – 7.6% on cane, EtOH- 17l/t cane

Ethanol only – 60l/t cane to 66l/t cane

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Ethanol Research 2002 -2004

4800 TCD factory could produce 74000 tonnes sugar and 11.3 M Liters of Ethanol

11.3 M Liters ethanol will permit 10% substitution in Gasolene

Ethanol production from factory generated molasses and fuel cane indicated to cost between 12¢ to 14¢ per Liter

Import price of Gasolene in 2003 - 24¢ per Liter Gasolene spot price reached 37¢ per Liter in June 2005

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Production 4800 TCD Case Study

Sugar - 73409t

Ethanol - 11.3M liters

(a) Cogen 5MW - 42GWh

(b) Cogen 12 MW - 105GWh

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Study Conclusions

Integrated production of sugar, ethanol and energy as electricity offered best economic potential from a factory of 4800 TCD capacity.

Fuel ethanol rapidly growing market possibilities including import substitution by gasolene blends and export

High fibre “energy cane” has potential role in extending crop to periods of weather disruption for power and ethanol production

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Commercial Ethanol prospects

Full feasibility to be conducted for a 12M liter fuel ethanol distillery from non contract molasses

Strong interest expressed by investors in a 130M liter fuel ethanol project from sugarcane on green field site

This project could support a 30MW cogeneration facility

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Planned Future Projects

Guysuco future plans include expansions of Enmore, Blairmont and Albion factories to capacities of 4400 to 5100 tcd.

Enmore is planned to be the focus of branded packaged sugar. Albion is being considered as an alternative site for a refinery

The expanded Enmore and Albion factories would have cogeneration capabilities with minimum exports of 7MW

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Next Steps

Feasibility of Proposed factory expansions Full Feasibility Study of Integrated

Production Model inclusive of ethanol production

Support for national commitment to renewable energy with recognition of the role of sugarcane

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THANK YOU FOR YOUR ATTENTION