Driven by ethanol

The company, owned by business magnate Lawrence Duprey and which is a subsidiary of Angostura, has sent ripples across the globe by entering the highly prized ethanol market.

The man leading the charge is Curtis Mohammed, general manager, who believes that ethanol can ease the burden of rising oil prices.

For Angostura, he says TBTL is all part of their global brand building strategy in placing the company in the global arena. He said the objective of TBTL was to give CL World Brands more leverage in the world arena, noting that TBTL profits were going to be ploughed back into CL’s brand building strategy.

He noted though that while there is money to be made, you have to have your wits about you.

On the business side, he noted that the raw material for the production of ethanol — hydrous ethanol — had to be brought in from Brazil. This is then dehydrated and sold to the US.

Why? Not only is it cheaper to do so but because they are able to meet the volumes required.

The company recently made its second shipment — three million tonnes worth about $US5 million to the US, a country hungry for alternative fuels given the country’s rising gasoline prices, he said. He admits that ethanol is not going to solve the energy crisis but is a viable option for reducing it. Ethanol now sells for between US$2.20 and US$2.40.

He thinks though that it is going to become crucial as a fuel as governments become more conscious of the fragile nature of the environment.

"We reviewed the project and decided it was feasible. What we have here is the tail end of the business," said Mohammed, who joined Angostura in 1998 and was once an engineer at Petrotrin.

He cited legislation in the US that mandates that a certain percentage of alcohol must be used as fuel, noting that this was beneficial to both consumers and companies that trade in the commodity. What’s also helping their thrust into the US markets is that, under the Caribbean Basin Initiative (CBI), their product is allowed in duty free.

Asked whether TBTL considered any global alliances, Mohammed said such an arrangement could provide access to markets and suppliers but it could also create a hole in their profits because that company can become their competitor.

Sitting in the Angostura board room with his lap top in front of him, Mohammed explained that Duprey was the driving force behind the $70 million ethanol plant being set up in Point Fortin.

It is turning out to be a sweet deal for Petrotrin since the oil company has leased its tankage, jetty and services to TBTL.

"It’s a decent revenue for Petrotrin," he said, noting that the arrangement was mutually beneficial to both parties.

TBTL was recently fined by the Environmental Management Authority (EMA) for breaching the certificate of environmental clearance (CEC). The lease if for 15 years.

Asked about this, Mohammed said they had ironed out this chink and moved on. "Yes, it was something that we had to deal with but that is business," he said.

The plant, which employs 27 people, is capable is producing 50 million gallons a year, but this can easily be doubled to meet growing demand.

For TBTL, the US market is proving to be lucrative but Mohammed said the company has its eyes on Europe where saving energy is high on the agenda.

He describes TBTL as being in the "renewable business," noting that they were looking to mine the ethanol vein in a way that left them with room to grow.

He noted that while oil and natural gas are commodities that are traded on established markets, ethanol was now making a mark of its own.

Although he did not want to reveal too much, he noted that the company was in the process of finalising a deal with an oil company in Barbados that wanted to buy ethanol to blend with its gasoline.

If that deal comes through then it’s going to be a major feather in TBTL’s cap.

He says the strategy of TBTL was not to be just an operator in the market but to be able to buy and sell in the open market. He cited Coimex which went into Jamaica, set up operations and paid for someone to operate the facility. TBTL, he said, did it differently: set the plant up and find clients.