The new Captain Morgan distillery will supply rum for the US market

The new Captain Morgan distillery will supply rum for the US market

Diageo has officially opened its controversial Captain Morgan rum distillery in the US Virgin Islands.

The facility, which provoked a political storm in the US earlier this year, was opened today (23 November) by the US Virgin Islands' governor, John deJongh, and Paul Walsh, CEO of Diageo. Once in operation, the distillery, construction of which began in August last year, will have the capacity to distill up to 20m proof gallons of Captain Morgan rum per year. The facility is also expected to generate an estimated US$130m in tax revenue for the Virgin Islands Government.

It is the issue of tax that has proved controversial. Since Diageo signed a deal with the USVI back in June 2008 to build the distillery, the company has been the subject of several attacks, claiming that it will benefit by around $3bn from a US tax break. Bacardi, which came out against Diageo's plans to move production of Captain Morgan from Puerto Rico to the USVI, provoked a stinging rebuke from Diageo in February this year.

At the official ceremony today, Governor deJongh and Walsh signed several rum barrels, and three time capsules were buried on the site to be opened ten, 20 and 30 years from today.