Tri-Marine officials cite major challenges to success
Tri Marine International officials have shared with officials of the Lolo Administration some of the challenges faced by the canneries, such as the drop in tuna prices and the high cost of energy — which is an issue the American Samoa Power Authority has been directed by Gov. Lolo Matalasi Moliga to investigate, including the possibility of using natural gas.
Tri Marine’s CEO and chairman Renato Curto along with chief operations officer Joe Hamby met last Friday morning with Lt. Gov. Lemanu Peleti Mauga along with top aides from the governor’s office. The governor’s delegation also toured Tri Marine’s Samoa Tuna Processors (STP) Inc., facility in Atu’u.
At a news conference after their meeting, Hamby told reporters that some of the issues discussed with Lemanu involve the challenges faced by the canneries, for example, the current tuna market in which prices for tuna are very low, which has an impact on the duty free advantage the canneries here in American Samoa enjoy when it comes to exports to the U.S.
Additionally, it also makes it more difficult to deal with labor costs in the territory.
“We would like to see tuna at a much higher value, so that the duty advantage, is maximized and the labor, as a percentage of the total cost of the tuna that is produced here, is less - percentage wise,” he said.
(The fact that tuna prices have plummeted was pointed out last year to the governor by the Tautai o Samoa Longline & Fishing & Association, when they informed him that albacore tuna prices had dropped by almost $1,000 per metric ton, and was one of the major reasons the local fishery industry was in decline to a point where longliner vessels were being put up for sale by their owners.)
Another issue under discussion is how to lower energy costs, which is something Hamby says the company continues to advocate. He said the high cost of energy is something STP and StarKist have to bear.
He also said the cost of energy on island is almost five times higher, and compared to some places even six or seven times higher, making it difficult for the company to be competitive in this global industry.
“At the end of the day, this plant is going to compete with other tuna canneries around the world. And that’s why we care about energy costs, we care about labor costs, and we care about the duty savings that we will be able to use to off-set some of those higher costs,” he said.
Tri Marine on the other hand is doing its share in keep down the cost of energy, for example, “using the latest technology, especially in the cold storage compressor that we use, we use a lot of insulation, throughout the plant, we use low energy lighting, we are doing everything we can to reduce the amount of energy that we’re going to be using,” Hamby said.
According to the Tri Marine official, the governor’s executive assistant Iulogologo Joseph Pereira — who attended the meeting — had mentioned that the governor is interested in finding ways to lower the cost of energy and the American Samoa Power Authority would be looking into a project that potentially could benefit not only the tuna cannery but the population of American Samoa.
Curto added Lemanu expressed the support of the governor and his staff in seeing STP complete all its projects. He also noted Tri Marine had asked for government support in areas of infrastructure such as the shipyard to repair boats.
He said the infrastructure request is not only for the cannery, but also for the fishing fleet that feeds the cannery.
Additionally, “we need good stevedoring, we need to have companies that are willing to provide activities to support the shipyard” as well as other types of specialists such as electric engineers. “We also need all kinds of support shops that will work with the shipyard,” he said.
(See yesterday’s edition for other information pertaining to Lemanu’s tour of the STP facility. Other issues raised during the news conference will be published in future editions of Samoa News.)
In his address to the Fono last month, the governor noted ASPA is diligently canvassing alternative energy technologies to reduce fossil fuel dependence and this is manifested by the expansion of its solar capacity which gives ASPA better base load replacement ability with the aim of reducing the cost of electricity to the people and businesses of the Territory.
“It is expected that the first phase expansion project will be completed and on line before the end of 2014,” he said.
Additionally, ASPA is boldly investigating the feasibility of using natural gas as the alternative base load in place of fossil fuel. “Natural gas is the least expensive and the most plentiful source of energy in the U.S.,” he said, adding that many states are now exploring the use of natural gas as an alternate fuel for electrical generation.
“The current constraint for American Samoa is the lack of portability of natural gas but the technology to liquefy the natural gas is significantly developed which will facilitate safe transportation to American Samoa,” he said. “ASPA is in the process of investigating the associated equipment requirements to utilize natural gas to generate electricity, along with its trade association and member utilities in the Pacific.”
Samoa News should point out that geothermal energy, as an alternative energy source on island, is also being explored — with people on island currently drilling for possible source areas.