Is Tony Myers of Sandy Cay Development Company who is harvesting aragonite at Ocean Cay in The Bahamas ...also an investor in U.S. Aragonite Enterprises ...which is buying aragonite from Ocean Cay?

Seeking truth

Document suggests Bahamian aragonite operator has interest in U.S. company he sells to

By CANDIA DAMES
Managing Editor
The Nassau Guardian
candia@nasguard.com
Nassau, The Bahamas

Is the owner of the company harvesting aragonite at Ocean Cay in The Bahamas also an investor in a company in the United States buying aragonite from Ocean Cay?

If the answer to this question is yes, it would mean the same people selling aragonite from our waters are selling the mineral to themselves in the United States, and this would have huge implications.

If the answer is yes, we wonder what impact this relationship is having on how aragonite is priced out of The Bahamas.

This question has emerged out of a National Review investigation into the aragonite industry and whether The Bahamas government is getting fair royalties.

This angle is one we could not ignore as we present fair reporting on what is now a national controversy.

The question was raised as a result of the discovery of a presentation available on the website plasticsindustry.org.

The presentation was made by the principals of U.S. Aragonite Enterprises, an American company, and Sandy Cay Development Company, a Bahamian firm, according to the website.

Sandy Cay has a lease with the Bahamas government to operate an aragonite facility at Ocean Cay, a 95-acre site, located nine miles south of Cat Cay, 27 miles south of Bimini and 65 miles east of Miami.

The online document states that U.S. Aragonite is the exclusive supplier of oolitic aragonite to the plastics industry.

It adds that the company was founded in 2011 and that “investors include owners of Ocean Cay, the natural source of the mineral”.

We knew from our previous interview with Sandy Cay Development Company President Tony Myers that U.S. Aragonite is one of his customers. But could it also be a company he is an investor in?

We contacted Myers with our latest questions.

When we read that line from the presentation to him, Myers said he is not an investor in U.S. Aragonite, but added that he had been in talks with U.S. Aragonite over buying a 25-percent stake in the company.

He also confirmed that he has sold to U.S. Aragonite, but said it was only one shipment, which he said he sold at $50 per metric ton.

Over the weekend, Myers showed us the invoice for this sale. According to that invoice, Sandy Cay sold US Aragonite 11,023 tons of aragonite from Ocean Cay on July 10, 2012.

Myers previously told us that his company has only sold 16 shipments of aragonite since it bought the lease in 2009 and formally began operations in 2010.

He said his shipments sold for between $12 and $20 per metric ton.

Myers showed us invoices for those shipments. The sale to U.S. Aragonite was the highest priced.

Under the 25-year lease Sandy Cay signed with the government on April 20, 2012, the government gets $2 per metric ton.

Myers previously told National Review that Sandy Cay has shipped 106,855.69 metric tons of aragonite since 2010 to various companies.

The government of The Bahamas has received $213,000 in royalties, according to a document he showed us.

Myers told us he has not yet made a profit from the Ocean Cay operation, five years after purchasing the old lease, and four years after starting aragonite exports.

When told that the U.S. company he sold to is naming his company as an investor, Myers said, “I didn’t know they did that. Technically, they should not have done it.”

He said that claim is not accurate.

But the claim is contained in the presentation on the plastics industry website that carries the names of both Myers and Marc Goldenberg, president of U.S. Aragonite.

We then contacted Goldenberg to ask if Sandy Cay is an investor.

He promised to get back to us with the answer to that question as he said he needed to check something.

Goldenberg soon contacted us back and advised that Sandy Cay is not an investor.

When questioned, he confirmed that there had been discussions with Myers to become an owner in the U.S. company, which lists its address as Salem, Massachusetts.

“We have talked about it,” Goldenberg said.

“But Sandy Cay, or Ocean Cay, isn’t an investor. At the very beginning, we were talking about that down the road, but things have not worked out.”

The online presentation that lists Sandy Cay as an investor in U.S. Aragonite is titled “Goldenberg Myers Oshenite SPI presentation”.

An agenda from the plastics conference last May in Nashville, Tennessee, lists Myers and Goldenberg as speakers on a panel titled “Bioplastics in Flexible Film”.

We found it curious that this presentation, which states Sandy Cay is an investor in U.S. Aragonite, had both the names of the Sandy Cay and U.S. Aragonite principals attached.

Goldenberg said he was not familiar with this and did not know why their names were listed together.

He confirmed that Sandy Cay is a supplier of aragonite from Ocean Cay to his company.

While Myers told us his company has only ever sold one shipment to the U.S. company, Goldenberg said Sandy Cay is “our only supplier”.

Myers said that shipment at $50 per metric ton is “the highest we’ve sold yet and every other invoice has been to non-related third parties”.

Pressed further on the matter of a reported investment relationship with the U.S. company he has sold aragonite to, Myers said, “Technically, we’re not an investor in it. Sandy Cay holds no stock in that company”.

He said the original presentation document put into the public domain by plasticsindustry.org was prepared by Sandy Cay.

According to Myers, U.S Aragonite “inserted” the additional pages, including the one that claims Sandy Cay is an investor in U.S. Aragonite.

Myers provided National Review with the presentation, minus those additional pages, when we first met with him more than a week ago.

On Friday, he acknowledged that Sandy Cay has a close association with U.S. Aragonite.

Myers noted that an investment in U.S. Aragonite would have required special approvals from The Bahamas government.

But he said the investment arrangement was never solidified as neither U.S. Aragonite nor Sandy Cay was doing well in the business.

Myers added, “It is the only customer that has not paid us. They lost so much money in trying to resell it into the plastics market. We’re not profiting by it and we’re not doing anything wrong because we don’t formally own anything in the company (US Aragonite).”

He also told National Review that Sandy Cay was only seeking that minority 25 percent interest.

“Why would I give them any preferential treatment when I would have only owned 25 percent?” Myers asked.

Referring to the statement that his company is an investor in U.S. Aragonite, Myers said, “They made that statement to try and strengthen their ties to our company, so that they can be seen as stronger.”

Goldenberg also told us U.S. Aragonite is not performing robustly.

He said it sells aragonite it gets from Ocean Cay after it works with another company to process the product.

“We sell it to the customers who would use it in certain applications,” Goldenberg said.

Myers has told us that aragonite is not refined at Ocean Cay.

Goldenberg explained that, “Raw material is useless in most applications. You can’t take the raw material and put it into plastic. You have to refine it.”

According to the presentation on plasticsindustry.org, U.S. Aragonite holds 50 percent ownership in Oshenite Performance Processing, a dedicated aragonite grinding facility.

U.S. Aragonite’s website notes that Oshenite oolitic aragonite is created naturally in the shallow waters of The Bahamas.

The website says, “Its genesis stems from an organic cycle of precipitation scientifically known as whitings, which yields a continuously renewing supply of an ultra 97-99 percent pure mineral; 20 million tons per year! It is pure from the ocean!”

Principal

Myers is also listed as the principal of another company, Ocean Cay Aragonite LLC, based in Boca Raton, Florida.

According to an online search, it was founded in 2011 and is privately held.

When we asked Myers about this company, he said, “I am a principal in it, but I’m not a shareholder.”

He said the company was set up, but never really used.

“We should have liquidated it and gotten rid of it,” he told National Review.

“We never sold anything to them. We never transferred any goods to that company, ever.”

A telephone number attached to the company online led us to a Jayson Meyers, who is listed under the rubric “officers and directors”.

Meyers said he and Tony Myers are not related, and noted that their names are spelt differently.

Meyers, whose address is listed as North Palm Beach Florida, said he is a “management consultant” for Sandy Cay.

He said he makes sure that the materials needed to operate at Ocean Cay are coordinated.

Asked whether Ocean Cay Aragonite sells aragonite, Meyers said, “It was set up to sell aragonite in the U.S. At one point it was conceived to do so.”

But he said it does not sell aragonite.

Concern

These matters have added another element to the aragonite debate that continues to rage.

Tony Myers has strongly rejected suggestions that his company is discounting its prices at Ocean Cay and benefitting from selling at a higher rate once the product gets in the United States.

We make no claim that he is indeed doing so, but report only on the trail our investigation followed.

As we opined in this space last week, it is important to get the facts out — without the hysteria.

The questions surrounding ties between Sandy Cay Development Company and U.S. companies are legitimate.

Getting the answers is important for full disclosure.

We admit there is something unsettling about the documents that are easily available through online searches.

The explanations given by Myers and Goldenberg do not fully line up.

It is also odd that the files Myers showed us reflect just one invoice for a shipment to U.S. Aragonite, when Goldenberg, the president of U.S. Aragonite, claimed Sandy Cay is his only supplier of aragonite.

While there has been a whole lot of misinformation spewed on this issue in recent weeks, the controversy has led us in an interesting direction.

There are more questions, and understandably, many Bahamians are demanding answers.

Minister of the Environment Kenred Dorsett assured on Friday that all matters connected to aragonite in The Bahamas, including Sandy Cay’s pricing structure, are being thoroughly reviewed.

We await the outcome.

May 19, 2014

thenassauguardian

Aragonite worth billions is being mined in the Bahamas ...Sometimes on a clear day you can't see the bottom

Dredging Money From The Bank

 

By Coles Phinizy:
July 06, 1970
si.com
 

Across the inky-blue Gulf Stream from Florida, near the sheer edge of the Great Bahama Bank, a new island is emerging from the sea. Although it bears the appealing name Ocean Cay, this new island is not, and never will be, a palm-fringed paradise of the sort the Bahamian government promotes in travel ads. No brace of love doves would ever choose Ocean Cay for a honeymoon; no beauty in a brief bikini would waste her sweetness on such desert air.

Of all the 3,000 islands and islets and cays in the Bahamas, Ocean Cay is the least lovely. It is a flat, roughly rectangular island which, when completed, will be 200 acres and will resemble a barren swatch of the Sahara. Ocean Cay does not need allure. It is being dredged up from the seabed by the Dillingham Corporation of Hawaii for an explicit purpose that will surely repel more tourists than it will attract. In simplest terms, Ocean Cay is a big sandpile on which the Dillingham Corporation will pile more sand that it will subsequently sell on the U.S. mainland.

The sand that Dillingham is dredging is a specific form of calcium carbonate called aragonite, which is used primarily in the manufacture of cement and as a soil neutralizer. For the past 5,000 years or so, with the flood of the tide, waters from the deep have moved over the Bahamian shallows, usually warming them in the process so that some of the calcium carbonate in solution precipitated out. As a consequence, today along edges of the Great Bahama Bank there are broad drifts, long bars and curving barchans of pure aragonite.

Limestone, the prime source of calcium carbonate, must be quarried, crushed and recrushed, and in some instances refined before it can be utilized. By contrast, the aragonite of the Bahamian shallows is loose and shifty stuff, easily sucked up by a hydraulic dredge from a depth of one or two fathoms. The largest granules in the Bahamian drifts are little more than a millimeter in diameter. Because of its fineness and purity, the Bahamian aragonite can be used, agriculturally or industrially, without much fuss and bother.

It is a unique endowment. There are similar aragonite drifts scattered here and there in the warm shallows of the world, but nowhere as abundantly as in the Bahamas. In exchange for royalties, the Dillingham Corporation has exclusive rights in four Bahamian areas totaling 8,235 square miles. In these areas there are about four billion cubic yards—roughly 7.5 billion long tons—of aragonite. At rock-bottom price the whole deposit is worth more than $15 billion. An experienced dredging company like Dillingham should be able to suck up 10 million tons a year, which will net the Bahamian government an annual royalty of about $600,000.

On the basis of such big, round figures, the mining of aragonite seems to be a bonanza operation. In reality it is still a doubtful venture for both Dillingham and the Bahamas. For Dillingham the big question is whether the aragonite can be hauled to market cheaply enough to compete with other suppliers. For the Bahamas the question is more provocative: What effect will the dredging have on tourism, the major industry of the islands? Two years ago the Bahamian government made a study of the tourist trade and found that out of a gross business of $193 million, about $52 million in wages and profits ended up in Bahamian hands. The bright beaches and clean waters, the deep reefs and shallow coral gardens, the game fish of the fiats and the bigger game fish of the open sea—these are the basic assets of tourism that are apt to be diminished by a dredging operation.

Dredging is inherently a dirty business. Worthy servant though it is, a hydraulic dredge simply does not fit into the natural scheme. The spume created by the cutter of a dredge's maw and the cloudy water from its discharge pipe are usually more than God's little marine creatures can tolerate for long. The Bahamian government does not say much about the aragonite operation, and the Dillingham Corporation says almost nothing. In this day when all sorts of strident anti-pollutionists are at the palace gates, reticence on the part of anyone who is roiling the beautiful Bahamian waters is understandable—understandable but also deplorable and, in the long run, stupid. It is human nature to suspect big operators, particularly the big, quiet ones who—true or not—seem to be making money hand over fist. By their reticence the Dillingham people are inviting distrust and as a consequence will probably be charged with crimes they have not committed.

A mile or two west of the Dillingham Corporation's artificial island, Ocean Cay, charter boats run the edge of the Gulf Stream in quest of billfish and tuna. Often, on the ebb tide, cloudy water driven by prevailing easterly winds moves from the Great Bahama Bank over the deep. This cloudiness is sometimes caused by long swells born of distant storms and sometimes by stiff local winds that kick up a fuss in the shallows. When the Dillingham operation gets going full blast, it will certainly add to the natural siltiness. In the future the cloudy water that fishermen encounter may be the work of a Dillingham dredge or it may be an act of God—or a combination of the two. It will not matter which. Since fishermen are human, innately suspicious and easily disgruntled, they will be inclined to blame all the dirty water on Dillingham.

One of the Dillingham mining concessions completely surrounds the Joulters Cays, a bonefishing area of proven worth. In the future, when the water is cloudy and the bonefish do not respond to the lure as they did of yore, the unlucky anglers will not take God to task; they will curse Dillingham.

Northwest of Ocean Cay there is a deep and little-known reef that stretches intermittently for eight miles along a submerged terrace—a rich and spectacular range. There are narrow canyons and caves in this drowned scarp, and a profusion of fish large and small. From the way the living corals spread over the buttresses of ancient rock it is obvious that the existence of the deep reef depends on a prevalence of clean water from the Gulf Stream. In the future if the water is often cloudy and the life of the reef seems to be wasting away, the scuba divers probably will blame Dillingham.

What effect aragonite mining actually will have on any parcel of the Great Bahama Bank is still a wild guess since no one has a sufficient grasp of the problem. Aragonite is fairly heavy stuff, weighing almost three times as much as water. When stirred up, the largest granules sink quite rapidly, but in a hundred tons of the deposit there are a couple of tons of very fine stuff that can stay in suspension for a week. In that time a large cloud of such material may travel 30 miles, riding the tide and the whims of the wind, casting shadows over rich marine areas that seldom suffer under such a pall. In scientific papers already published on the Great Bahama Bank there is good information about the movement of water, but none detailed enough to indicate just how a constant stream of cloudy water is apt to wander from a given location.

Before any biologist could assess the effect of aragonite mining, he would have to know a bit about the operation, specifically how the dredges are to be used and the expected rate of production. The Dillingham Corporation has declined to give out such information, maintaining that it might be "a benefit to other suppliers of limestone on the mainland." Since the corporation has exclusive rights to the Bahamian drifts, and will be using mining techniques different from those employed in quarries, it is hard to see how such basic information could possibly benefit rival suppliers on land.

The Dillingham Corporation claims that the Bahamian government has already had "ecological studies" made in the area of Ocean Cay and is having "continuing studies every 90 days." Although this claim is a slight overstatement, it is true that, at the request of the Bahamian Ministry of Agriculture and Fisheries, last December Dr. Durbin Tabb of Miami's Institute of Marine Science did make a two-day survey of the area. Dr. Tabb was obliged to conduct his investigation on a budget of $1,500 and without a complete idea of the dredging technique or any knowledge of the expected rate or continuity of production. On the basis of his hit-and-run survey, Dr. Tabb concluded that there was no solid reason why the relatively sterile aragonite drifts should not be mined, provided the operation was kept under surveillance. He was particularly concerned with the effect the altered bottom contour might have on turtle-grass beds in the shallows and what effect the silt from dredging might have on tuna migration in the deep.

Confronted by concern among biospecialists and by rumbling in the press, last month the Bahamian Government Information Services put out their first news release on the aragonite operation. The release emphasized Dr. Tabb's solid opinion that the aragonite areas are undersea Saharas of little biological worth. It said nothing about what might happen when the dust of these submerged Saharas is kicked up by a dredge and drifts over richer areas downstream.

A large hydraulic dredge with a two-foot throat can easily pick up 10,000 cubic yards of loose aragonite in a day. In the process it also sucks up at least six times as much water—roughly 10 million gallons. When that much silty slurry drains directly back into the sea, it creates quite a cloud—virtually an endless stream since dredges usually operate day and night in the interests of economy. Under their contract with the Bahamas, the Dillingham Corporation has the right to pile up 12 artificial islands. Logically, in the coming years the corporation will situate these islands so that dredges with a practical range of several miles can discharge aragonite and slurry directly onto them. In such case the cloudiness will certainly be diminished. The extent of it will depend largely on how much silt the head of the dredge stirs up and how much remains in solution when the slurry drains, or is pumped, off the islands.

When a storm of gale force sweeps the Bahamas it produces cloudy water that may persist over vast areas for as long as a week. A hundred dredges toiling around the clock could not possibly create a condition comparable to what the Bahamas get when a hurricane gives them a good dusting. But there is a difference. The storms of nature are a very sporadic blight. They have occurred throughout many yesterdays and will come again tomorrow. The life of the sea, often hanging in fine balance, has accommodated to that inevitability. Human pollution is a brand-new burden. The unnatural filth suddenly contributed by man may be only a pennyweight of the total, but that is sometimes enough to tip the scale.

Drab though it is to the naked eye, a mat of turtle grass on the sea floor is quite a vital place. On the slimy blades of grass there are a host of minor organisms that feed on smaller organisms and are themselves eaten by larger ones. Seven years ago Dr. Donald Moore of Miami's Institute of Marine Science found, among other things, 28,000 univalve and bivalve mollusks in one square meter of turtle grass. Ten years ago, using seines and push nets, Victor Springer and Andrew McErlean of the Florida State Board of Conservation sampled a shoreline flat of the Florida Keys one day each month for a year. Although the sand and grass tract they searched was less than two football fields in area—and the water did not exceed five feet in depth—Springer and McErlean found 106 species of fish. Grunts, snappers, gobies, porgies, blennies, wrasse, groupers, barracuda; yellowtail and tripletail; batfish and lizard fish; goatfish and parrot fish; big-eyed jacks and little queen triggers; pipefish and filefish and spadefish; bonefish and surgeonfish; needlefish and thread herring—you name it, Springer and McErlean found it. A good number of fish they netted in the shallows were juveniles of species that subsequently take up residence on coral reefs in deeper water.

Many fish that dwell in, on, or around living coral return to the grasses behind the reef to forage. Some of these reef dwellers go to the grass to feed by daylight, others hole up by day and feed at night. As Dr. Gilbert Voss of the Institute of Marine Science puts it, "toward evening, between the reef and the turtle grass, there can be a real traffic jam." While serving at the University of Puerto Rico three years ago, Dr. Jack Randall examined the stomachs of 5,526 reef fish of 212 species. Curiously, although soft coral polyps are easily ingested, and should be nourishing, only 10 of the 212 species that Randall examined had eaten any coral—none of them more than a trace. A preponderance of the species Randall studied were directly or indirectly dependent on the turtle-grass beds for nourishment. Sea urchins, which eat turtle grass, would seem to be too painful a mouthful for almost any fish, yet Randall found a considerable percentage of urchins in the stomachs of 34 reef species.

In the clear waters of the Bahamas today nursery and feeding grounds of turtle grass commonly prosper 25 feet down and have been found at 40 feet. By contrast, for want of light in the turbid waters of Biscayne Bay around Miami; turtle grass is no longer found much deeper than 10 feet. To sum it up, when a dredge forces a turtle-grass bed out of business, the curtain also comes down on a hell of a big variety show.

It is a common fallacy of man to believe that a profusion of other forms of life is proof of their prosperity and permanence. Despite all its variety and oddity, despite its apparent extravagance and luxuriance, a coral reef is often a desperate place. As viewed through a diver's mask, magnified to heroic proportion, the finest reefs of the Bahamas seem to be durable, monumental works of long standing. In truth the very best of Bahamian reefery is no more than a thin veneer—a very recent culture of reef corals that has managed to take hold and spread mostly in the past 5,000 years under conditions that have probably never been ideal.

When silt particles settle upon them, the polyps of reef-building coral must work to get rid of the intruders. When the workload becomes excessive, the polyps are forced to close shop for a while—and sometimes forever.

Today, largely because of the work of the late Dr. Thomas Goreau of the University of the West Indies, scientists recognize that turbid water has still another adverse effect on reef corals. In clear, shallow water of 10 feet the coral Acropora palmata—one of the primary reef builders—is usually massive, thick-limbed, on all counts prosperous enough and strong enough to hold its own against the constant invasion of borers and the pummeling of the sea. A mere 10 feet deeper, the same species, if found at all, is much weaker in structure, and growth by actual measurement is considerably slower. When cloudy water persistently reduces the light, the coral is, in effect, thrust to a depth where it cannot build and where it may not survive.

When Astronauts return to earth, the moon dust is vacuumed from them and they are quarantined for two weeks. The moon dust is reputedly sterile, but we take no chances. The Dillingham Corporation and the Bahamian government are willing to gamble with the sterile dust of the aragonite drifts. When there are so many specialists today who can minimize the risk, why do they gamble? Primarily, it seems, because Dillingham prefers to hoard the truth and the Bahamian government is too skinflinty to pay for a proper investigation. In a day when we are all getting a trifle sadder and wiser about the environment, this view is as murky as the waters surrounding Ocean Cay.

si.com 
July 06, 1970

Call for The Bahamian Government to increase the royalties it receives from aragonite mining on Ocean Cay in The Bahamas

Groups demand more aragonite royalties

BY TANEKA THOMPSON
Guardian Senior Reporter
taneka@nasguard.com
Nassau, The Bahamas

Bahamas Public Services Union (BPSU) President John Pinder yesterday called on the government to increase the royalties it receives from aragonite mining.

Pinder estimated that the government could pocket as much as $300 million per month, or $4.2 billion a year, if it renegotiated its aragonite royalties to no less than $350 per metric ton.

The government currently receives $2 per metric ton of aragonite exported out of the country, Pinder claimed.

Pinder said the increased revenue could pay off the national debt and negate the need for new taxes, such as the proposed value-added tax (VAT).

“I’m deeply shocked and aggrieved to find that successive governments of The Bahamas, starting from the UBP, the FNM and the PLP, have all done us a disservice by signing a contract and giving away the natural resources of our country for pittance,” said Pinder at a press conference in Rawson Square.

Members of the Bahamas National Citizens Coalition, the Police Staff Association and the Prison Officers Association attended.

They support Pinder’s call for increased aragonite royalties.

Aragonite is a naturally occurring, valuable carbonate mineral.

Pinder said aragonite is sold at $900 a metric ton.

“We believe that certainly the government can do much better than that, as the country is strapped for cash at this time and a number of things are needed and the government does not have funds to do these things,” he said.

Currently, the only major aragonite mining operation exists on Ocean Cay.

That project is carried out by Sandy Cay Development Company Limited under a 25-year lease initiated in 2010.

Among the companies that Sandy Cay Development Company supplies is U.S. Aragonite Enterprises LLC, which produces a plastic product known as Oshenite.

Pinder said his union understands that the government’s contract with the company for aragonite export expires on June 3, 2014.

“We are asking the government in its new negotiations on the royalties on aragonite coming out of Ocean Cay, to not receive less than $350 a metric ton.”

Pinder added: “We believe if the government is able to accomplish this, we are talking about paying off our national debt in 18 months.

“We’re talking about moving from being borrowers to lenders. What China is to the world today is what The Bahamas could be to the Caribbean.”

He added that revenue from increased aragonite royalties could be used to pay every Bahamian at least $50,000 within 18 months of adjusting the terms.

“We are asking the government before it presents its budget to the House of Assembly this month to please insert what revenues we will receive from aragonite so that the country is able to move forward in a more positive way,” Pinder said.

When contacted for comment, Minister of the Environment Kenred Dorsett said the details surrounding aragonite mining, including increasing the royalties the government receives, are under consideration.

The Nassau Island Development Company plans to meet with residents of east Grand Bahama tonight to discuss an aragonite proposal.

The company said it has submitted a proposal to the government to develop a $50 million aragonite facility.

May 07, 2014

thenassauguardian