After three years on the drawing board, the CariSal plant will be built this year. Kristine Gibbon-Thompson, CariSal's vice-president of strategic and business development, has spent the "long gestation" period securing financing, negotiating contracts and putting together an airtight project which has survived a difficult period. She says financing-the company's major challenge since inception-would be concluded by March 2011, with construction to start by June.The plant came on the local radar in August 2008.
Guardian Holdings-through its then energy fund, Prometheus-had invested an initial US$10 million into CariSal. While sourcing investors for the project, Gibbon-Thompson, then vice president of business development at GHL, was introduced to US private equity firm, Denham Capital Management, which injected US$50 million into CariSal. Denham bought over Prometheus and hired Gibbon-Thompson from GHL. But CariSal's business proposition was challenged by timing.
Gibbon-Thompson vividly recalls that the financial crisis, which caused recession in most developed economies, began the day before CariSal presented its business proposal to international investors in New York. At US$400 million, the project was considered too large for complete funding from the local market. Locally, the challenge with funding was capped at US$100 million, so the company was forced to seek international financing. First, it had to ride out the economic crisis. Gibbon-Thompson said the plant now has funds from four banks and two development finance institutions.
At the moment, she's wrapping up the last piece of equity-US$50 million-with a project partner who is committed to taking 50 per cent of the caustic soda produced. Apart from financing, the CariSal site was also an issue. The parcel of land first identified by the National Energy Corporation (NEC)-a site for its new industrial estate, Pt Lisas south-was not owned by the NEC. CariSal has requested Cabinet approval to lease the land from the State; for which it has already received a certificate of environmental clearance. It is now before the Attorney General.
But Gibbon-Thompson, in an interview with the Business Guardian this week, pointed out the advantages:
1. The plant will hire 67 permanent employees and 45 contract employees. For the two years construction period, 400 jobs will be generated.
2. Cognisant to not replace the sole importer of caustic soda, EISL Industries in Pt Lisas, CariSal will now supply EISL's caustic soda demand. CariSal will produce 120,000 tonnes of caustic soda.
3. CariSal is looking to market its calcium chloride-in pellet form-to Africa and South America. It will produce 150,000 tonnes of pellet. The caustic soda and calcium chloride will provide 90 per cent of CariSal's revenue.
4. The company is looking to develop local and regional markets for bleach.
5. CariSal has signed a 20-year agreement with the National Gas Company (NGC) and T&TEC. It will use 4.8 million cubic feet of natural gas from NGC.
"There's flexibility built into the processes in the plant, which can affect production based on market variations and opportunities," she explained. She pointed out that while the company will go for two years with no income, she expects investors to be paid off between three to five years, once the plant is up. "The rigour has, in the final analysis, created a stronger project," she said.
Kristine Gibbon-Thompson is the chief executive of Canboulay Energy Capital and vice-president, strategic development, at CariSal Investment Holdings Ltd. She's spent eight years at Guardian Holdings Ltd as vice-president, business development, where she led the mergers and acquisitions function and ran the Prometheus energy fund. She spent seven years in management consulting at the Boston Consulting Group in Toronto, New York and Australia. She holds a bachelor of commerce degree from Queen's University and a Masters in business administration from Harvard Business School.