The president of Ancap, Alejandro Stipanicic, I consider that “Uruguay overvalued the industry portland” when analyzing the failed tender to open that business to private participation, although he ruled out that it was a failure.
Stipanicic, who received Ambit in his office in the Ancap building in the middle of a busy week, he assured that “now we have to face the harsh reality and the reality is that if we continue doing exactly the same thing we are going to lose a lot of money againtherefore we are left without alternatives.”
— Are you concerned that any of the companies that have already shown interest in participating in the large energy transition projects in Uruguay will back down after the high level of union conflict?
When you talk about unions, the word you use does not matter, the concept behind the union matters. In Uruguay and in Argentina the word labor union represents a different concept. In USA, in Germany, in Japan is another one. There are unions in all parts of the world, but they have certain ways of working, resisting or raising their demands. In Uruguay unions are still very ideological, resist certain ideas that are much more widely accepted in other parts of the world. The conflict in Uruguay Depending on the sectors, it is reasonable or very high. In public administration in Uruguay she’s very tall. The public administration has a very great weight in the economy, the number of public officials in the public administration is perhaps a third of those employed in Uruguay and it has a lot of public significance.
What happened in recent weeks with the conflict in Ancap refers to a ideological struggle precisely in a public activity with which the two dimensions are enhanced.
The aggressiveness and the magnitude of the union mobilizations undoubtedly influenced the decision of the potential investors to not bid, but it is not the only reason and for other investments in the future, what you really have to look at is whether there is value in the business or not. The conflict in the refrigeration industry is also high and, however, there are continually openings, closings, purchasing movements in the meat processing plants because the livestock business in Uruguay It is still very important.
Without a doubt, a country with absolute peace and union normality and that the demands are specific, sporadic and justified is not the same as ideological resistance to certain changes. What worries me most personally is that the ideological discussion is taken for granted. labor rationing bases of the last century and we are missing out on discussing issues such as the incorporation of Artificial Intelligence (AI) to the management of the refineries. Many refineries in the world are already being managed by systems based on artificial intelligence and the discussion in those places is how ethical it is to more or less let AI manage a complex and dangerous facility. Soon the processing capacity of AI will begin to multiply with the introduction of quantum computing. You enter the field of what is known as quantum disruption, you are talking about a world that is not too far in the future, which is an absolutely transcendent, disruptive and disruptive change in the technological point of view in which if you do not You are not going to be able to work in a refinery. So does it make sense that today we are working on labor relations of the 20th century or from the middle of the 20th century?
It makes me very bitter and tormented by the idea that we are discussing the past when we should be talking about the future. The union conflict It is always a fact of reality, if the business is very attractive that cost can be exceeded. But when the business is not at all attractive, as happened with the Portland industry in Uruguay and the proposals we made, obviously Uruguay overvalued the Portland industry and we had warned that this was a risk.
—Were you surprised that in the end there were no offers?
No no. We were not certain, but we knew that the risk was 50%. Basically because when analyzing the regional market, the first conclusion one draws is that the demand of the regional market is around 73-75 million tons per year and the production capacity is 130 million.
— Don’t you feel that it was a high political cost to have gone through the conflict with Fancap, to carry out the tender and there was no offer?
No, because we did what we thought was better for the country. We accept a lot of suggestions and complaints. And we offered a package that no one can question because the limestone reserves were still managed by Ancap, We did not sell the assets but we partnered to manage them, we contemplated the largest possible number of workers who remained in the industry and the investment requirements They were associated with the investment plan brought by the offeror. The requirements were a pretty solid set for critiques. In fact the criticism remained at ‘we don’t want the association because we don’t want the association’.
Having gone through this entire process and it being a process without offers brings a reality check to all of us and puts us in a much bigger problem because the conclusion of this entire process is that Nobody valued the Portland business. He is of no use to anyone. When one analyzes the factors we do not have to go very far, just look within Uruguay. Many times I was asked why it would be attractive to a private person what is not attractive to Ancap and my answer was always ‘what happens is that the business of Ancap in Uruguay It cannot be attractive to anyone because local demand is around 800,000 tons per year and the two competing plants equally offer one million tons per year. That is, the production capacity of Ancap It does not add anything to the market and production is at a much higher cost and losing money. So I don’t consider it a disappointment, I don’t consider it a failure. We feel very satisfied with the process, it was what we had to do. The issue is that now we have to face the harsh reality and the reality is that if we continue doing exactly the same thing we are going to lose a lot of money again, therefore now we are left without alternatives. The natural conclusion of this entire process is we have to close the business. If this were a private company, it would not have survived 20 years with losses, but even so we reached this level where you go to a process and no one buys it from you. Obviously, the value assigned by third parties to your business is zero. Therefore, if we cannot close the industry because it is an industry that depends on the State, we are going to have to go to costs reduction and that leads us to say that We can no longer ensure the continuity of all jobs. We are in a complex situation in which we are going to have to take tough measures in the coming months and we will do so in the most sensitive way possible.
— Ancap is facing the shutdown of La Teja for maintenance, what will it be like for the company the day after reactivation, taking into account the costs, the possibility of issuing debt?
If you are talking about the future of Ancap In 20, 25 years, I see it as a company with a advanced transition, with several projects with third parties where the risk was borne by third parties with Ancap taking part and managing the transformation of the refinery towards a biorefinery. We promote the idea of generating a Investment fund in Uruguay, surely next to BROU and some fund manager, to create a escrow with a community of local investors who are eager to have investments of some attractiveness in the future.
I think that the physiognomy of Ancap It’s going to change a lot. If not so, Ancap is condemned to stay in the 20th century and the facts are stubborn and reality is very stubborn and I think that the vision of Ancap in the future it is from a company that adapts to the energy transition, to the new skills required for people. The great challenge of Ancap It’s the next generation of employees. How are we going to attract them, how are we going to retain them, how are we going to pay them, how are we going to contemplate their requirements when we have labor relations that are from the 20th century.
Source: Ambito
