Ivan wreaks havoc in Caribbean

Hurricane Ivan, a category-5 storm, has struck with a vengeance, causing devastation in Grenada and extensive damage in other areas of the Caribbean.

The four-largest bauxite and alumina producers (Alpart, Jamalco, Windalco and Kaiser Jamaica Bauxite) in Jamaica shut down a day before the storm hit.

Total combined annual production capacity at these facilities is about 3.9 million tonnes of alumina and 14 million tonnes of bauxite.

The alumina plants were shut down sequentially so that the systems were drained of alumina to ensure a clean startup. In Jamaica, the bauxite and alumina industries employ about 5,000 people.

Oil ports and refineries in Venezuela and other parts of the Caribbean were closed as the storm passed through.

A category-5 hurricane is the most intense storm on the hurricane scale. This category indicates that wind speed is greater than 248 km per hour, the barometric pressure is less than 920 microbars and the storm surge is greater than 5.5 metres. Storm surge is water that is pushed toward the shore by the force of the winds swirling around the storm. In addition, storm winds superimpose on the storm tide resulting in even higher water levels.

Kaiser Jamaica Bauxite is 51% owned by the Jamaican government and 49% by Kaiser Aluminum and Chemical (KLUCQ-O). Subsidiaries of Century Aluminum (CENX-O) and Noranda (NRD-T) agreed earlier this summer to buy Kaiser Aluminum’s stake in the St. Ann bauxite mine and the Gramercy aluminum refinery in Louisiana.

Jamalco is a 50-50 joint venture between Alcoa (AA-N) and the Jamaican government.

The Jamalco refinery was not significantly damaged by the storm, however power was cut off for several days and the port from which Jamalco ships its alumina sustained substantial damage. At presstime, Alcoa planned to declare force majeure because of probable delays in shipping its product.

Ivan was packing winds up to 260 km per hour. As many as 37 people had died on the island of Grenada in the wake of Ivan and the area was declared a national disaster. Another 19 were killed in Jamaica, three in Haiti, four in Venezuela, four in the Dominican Republic and one in Tobago.

Shell Oil evacuated 850 people from oil rigs in the eastern and central areas of the Gulf of Mexico. The platforms and the rigs are designed to withstand the high winds and waves, but the company was not taking any chances.

Oil prices soared to US$44 a barrel on Sept. 14 on speculation that supplies could be disrupted. The Gulf of Mexico produces about a quarter of the U.S. oil and gas output.

The eye of the storm passed by the western edge of Cuba; hundreds of trees and buildings fell, power lines were knocked down and some communities were flooded but at presstime there had been no loss of life.

Sherritt International (S-T) owns a mine in northeastern Cuba that produced 15,553 tonnes of nickel and 1,571 tonnes of cobalt last year. Its stock fell less than 1% prior to the storm and then regained the loss following its passing.