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Tag: cement

  • ‘Cement is less than 20% of building cost’

    ‘Cement is less than 20% of building cost’

    The high cost of cement remains a huge problem, which seems to have defied solution. Reason: the country’s cement production capacity outweighs its demand. “I wouldn’t want to go into that…there is an emotional part of it and we tend to be emotional,” says the Chief Executive Officer of AshakaCem Plc, Rabiu Umar, in an interview with reporters during a tour of the company in Gombe State. He speaks on other issues, including the task of keeping the company afloat and its corporate social responsibility cases. MUYIWA LUCAS was there.

    Many people think the price of cement is high, considering that Nigeria produces more of the product than it needs. What’s your take on this?

    I wouldn’t want to go into that. It is very controversial because there is an emotional part of it and the real part of it. And typically, we tend to be more emotional. I don’t want to go into details but it is not quite true that all our raw materials are locally sourced. You can find out how much cement is in Chad and Niger in dollar and make the comparison.

    The price of cement is usually blamed for the prohibitive cost of housing. To what extent will you say cement influences housing affordability?

    Cement is less than 20 per cent of the total cost of building construction. So, you may want to ask what is the correlation between cement and the cost of building. The global average is six per cent; this is a verifiable and scientific information. Depending on the building practices, for instance, not everyone uses hollow blocks, some use the formwork. That way, there is a lot of saving. So, there are a lot of building practices that help to bring down price but when you look at the price of blocks and cement, the global average is six per cent. In Nigeria, it may be seven per cent but I don’t think it is up to eight per cent. Typically, people think if the price of cement is half of what it is today, it increases affordability or the number of people that can afford to build their own homes. In a sense, you can say yes, but it is only six per cent. The rest of the 94 per cent is in the finishing. You can build and finish the carcass of your building and you are just 30 per cent of the way including the concrete, beam and all. You find out that the cost of one door will probably build the walls. That is where most of the cost goes.

    How are government policies impacting on your business?

    I think there are two levels to it. Government policies in a sense have helped us to operate because without a framework, you cannot run. But is there room for improvement? Of course, there is. One of the key things that are really confusing is multiple taxation. There is the federal, state and local government tax regimes. And sometimes, when you stack up everything, it is a bit confusing to understand at what level it stops. Multiple taxation is one of the key drivers of business that every business owner talks about in the country. It also brings about uncertainty; you plan something you want to do this year and suddenly, something comes up that is not in your plan but can have an impact on your planning and result.

    What does the cement industry contribute to GDP?

    It depends on the level you take it from but between N18 and N20 billion a year, depends on the demand. It was a little higher the previous years but it dropped.

    How did the lull in the property market affect cement sales during recession?

    First of all, Nigeria went into recession and anybody who lives in Nigeria knows the impact. The cost of anything that has any correlation with foreign exchange has doubled. That is a reality. The income left after taking care of basic needs has gone down, and naturally, there is no way it won’t have an impact on certain sectors that are not immediate, like food. And then of course, the economic situation means that the market is not growing as fast as expected and I think that’s a publicly available information.

    How do you control your operations so that it doesn’t impact negatively on the environment?

    Cement business involves extracting things from the ground, but at the same time, we have a standard. LafargeHolcim has the largest building materials business in the world. Our policy is that if a country we are operating in has a lower operating standard than the one set by the company, then our company standard becomes what we use, and vice versa. So at any point in time, we make sure we are well within the standard that each location has. We have a very high standard; there are different regulatory agencies that we work with- the Ministry of the Environment, National Environmental Standards and Regulations Enforcement Agency (NESREA) and several others. The key concern here is the dust emissions and when it comes to coal, there is the acidity issue. And of course, before you even get licence to operate there must be an environmental management plan in place.  But beyond that we make sure we have an improvement plan. For instance, a few years ago, you know you are approaching AshakaCem when you find dusts on vehicles along the way, but today, that is not the case. It has reduced and we have the number to show for it. We hosted the former minister of environment sometimes ago to see what we are doing. Of course, there is always room for improvement but the most important thing is to ensure that the dust emission is lower than the limits set by the environmental plan.

    Lafarge has some affordable housing interventions in the Southern part of the country. What similar initiative do you have in the north?

    It is a national programme, not specific to any region. We are in the process of developing one in this region. Affordable housing comes in different shapes and forms. For instance, you may want to build houses in large scale. So, there is affordable housing and there is mass housing. So mass housing may not be the bottom of the pyramid but it allows more people to really have access to housing. And how does it work? You’re building this same structure in a thousand places and instead of using blocks you can use what we call the form work which is one of the things we are working on. We have done one in Ogun State, and we are taking people from the north to see how it works because the idea is to copy the model and ensure we can do it quickly and in a cost-efficient way.

    How are you coping with competition in the industry?

    The main thing we do is to focus on the customer and make sure we give them what they want. At the end of the day, cement goes everywhere. In reality, there is more than the demand but we are focused on making sure that our product does what it says it does. It is not about the technical aspect because at the end of the day, the customer can measure what he got from the product. Our focus is on making sure we are close to the customer and that we are giving him what he really needs. For instance, a blockmaker wants to work quickly and in as little time as possible, take the block and reuse the same wooden palette. So today, we have a particular product designed for that, it is called Superset; it is the fastest setting cement in the country and it means that segment will have preference. If you meet the big contractors, their needs are different from the regular trader who buys cement and resells. So, what we try to do is make sure we work with them from the beginning of a project to know what their needs are and I think that has worked for us thus far.

    How were you able to continue running your business at the height of Boko Haram hostilities in the North East?

    On November 4, 2014, our plant was attacked by the insurgents. Obviously, they were trying to find explosives. Exactly one month after that, there was another attack. Of course the default thinking was for the company to shut down during that period until things calmed down, but the management of LafargeHolcim took a decision to keep it open because as you may know, stopping and starting an operation of this magnitude is not really a day’s job. We have staff of 700 people working here and we live in a place that is more or less like an island. So, even if we shut down the operations, the staff are still here; you can’t have 700 people suddenly pack their bags to go somewhere.  Therefore, a decision was reached at a significant financial expense to keep the plant running and I think it was the right decision. It has shown that we have the resilience when it comes to keeping our operations running.

    Looking at the post-insurgent era, how are you contributing to the redevelopment of the Northeast region?

    To start with, we make cement and most of the destructions in the area were civil in nature- if you take out the psychological and socio-economic aspects. So, naturally, we are contributing in that regard. If you remember, there were more than two million people who were displaced by the insurgency and by virtue of keeping this operation running, we are helping to make sure there is enough economic activity in the area. Like I said, there are 700 people working here directly and probably another 2,000 people who do supply and other things. The average household in this part of the country is 10; so you can imagine what the company has done. A more direct approach is helping the communities acquire skills that can be useful in terms of social services and healthcare as well as education.

    In specific terms, how have you impacted on this community?

    We have an artisanship scheme, for example, that has intakes from the communities around here, and it is strictly created for them. Graduates of this scheme go on to set up their businesses. If you are a carpenter or a mason, we train you and you get the tools of the trade and can go into the community to start. At the same time, we absorb some of them into our firm. For instance, the second most senior person here on the industrial side, after the plant manager, is an indigene of Bajoga, (our host local government), who came through the artisanship programme- we took him to South Africa and also our sister plant in Calabar, Cross-River state, as the second most senior person there.  Let me clarify that we look at our contribution from the perspective of our operations rather than direct interventions. We have built classrooms, boreholes and a lot of things but we call those “business as usual” because they are basic things that we do. Building classrooms doesn’t mean that education will happen, so we do more sustainable activities in that regard.

    How else do you give back to the community?

    Giving back to the community comes in different forms and sizes. For instance, the focus we have as a company worldwide is healthcare, youth empowerment and education. These are things that everywhere you go in the LafargeHolcim world, though the style of implementation may differ, but these are the three core things. When it comes to healthcare, for instance, I can say directly, today on a daily basis we have a clinic that treats over 200 people from this community, every single day. Both consultation and drugs are free; it is one of the things we believe is important. In terms of youth empowerment and employment, we have in excess of 2,000 graduates since the beginning of the artisanship programme and every year, we keep taking them and we pay them for the two years that they are here on the programme. Over 90 per cent of the beneficiaries are of northern stock- 70 per cent are from the Northeast region. Gombe state indigenes account for 56 per cent of our staff strength, while most of the others are from communities around us. And when you look at education, we have two schools right inside AshakaCem premises and they have over 1000 students and 60 per cent of them are from the community and they don’t pay school fees. I think also beyond how much money we give the youths, there are also other exchange programmes that we have. A Polytechnic is about to start at Bajoga, the reason for citing the school there is because AshakaCem exists here. Polytechnics produce hands-on people, the plan is that we will partner with the school to do a lot of exchange programmes.

    Sometime last year, you singed MoU with some communities. How far have you gone with the implementation of that agreement?

    The implementation is ongoing. We ran into some misunderstanding. Everywhere you operate a mining activity, you must have a community development agreement which defines the basics of what you must do; but you don’t limit yourself to only what is in the agreement. We ran into some hitches but the agreement is being implemented while we are trying to do more. It is not everything we do that is in black and white. The medical thing I talked about earlier is not part of the plan but we do it. The MoU contains a five-year programme, but what we try to do is make sure that whatever we want to do within a year, we do it before the year runs out so that the community can start enjoying the benefit.

    This community is largely agrarian. Do you have plans to empower the community through farming as some sort of CSR?

    Absolutely! This is one project that we are doing; it is at the starting phase. We are starting an agricultural programme called Agri-ecology; it is all about mixed breeding- where one crop fights the pest of the other, for instance, leading to the creation of a high yield. It is also about taking the ecology of agric process back to its natural way. So, we are going to roll that out to empower our communities and help increase their yield by up to 30 or 40 per cent. It means they can generate more revenue from one piece of land. The other side of it is that it will help them to organise better distribution in terms of what they get from the produce. There has always been the issue of farmers not getting value for their labour, so, we are doing this to help them to get more value from their farming activities and turn it to an all year round thing. We are starting the pilot scheme this year with tomatoes because we hope to start with cash crops. The farmers won’t have to just wait for the rain. That’s what we are working on. The second part of  this scheme is linked to how we help control our carbon dioxide (CO2) emission. The Federal Government tries to encourage rice farming everywhere, so the rice husk, a by-product of rice processing can be used in our kiln. We call it geo-cycle. The idea is to take corn cubs and the rice husks to produce clean energy and at the same time clean the environment. The producer doesn’t go to the farm to produce rice husks or corn cubs but at the end of the day he makes more money in addition to what he makes from the produce because we buy it off him.

    What short term plans do you have to keep your customers in business?

    It goes back to what I said, it is basically the promise that the products will deliver. We get feedback from our consumers and work on that. That is what we do everyday; making sure they remain in business because that also helps us to remain in business.

    Five years from now where do you see Ashaka Cement Plc in terms of expansion?

    Where we see AshakaCem is as a more efficient business in the next five years and one of which is from the cost perspective. There is currently a project ongoing, we are building a power plant to be able to generate our own electricity. Today, we are relying on generators, and as you know, the cost of fuel whether low pour fuel oil (LPFO) or diesel is very high and has a high correlation to foreign exchange. We are building an N11billion, 16-megawatt coal-fired power plant to cater for our needs. That is one of the biggest plan that we have in terms of being able to reduce our costs because one of the biggest cost in cement production is the cost of energy. Inside the kiln, we have temperature running up to 1,400 degrees which is heat temperature required to melt steel. You can imagine the kind of heat we are talking about here and to generate that kind of heat, we need fuel.  The second is to unlock some of the existing potential in terms of capacity, over the years, you lose some efficiency and we are trying to gain back that efficiency. The other is, depending on how things go, we intend to increase the capacity of the plant by building new capacity.

  • Tunisia plans to sell over 50% stake in cement firm

    Tunisia plans to sell over 50% stake in cement firm

    Tunisia has called for Expression of Interest for the acquisition of majority stake of 50.52 per cent in Carthage Cement S.A. Carthage Cement is a public company which is specialised in the production of cement, aggregates and concrete.

    The 2.2 million ton capacity plant, which was equipped by a market-leading supplier of cement industry equipment, is located in the southeast of Tunis. The company operates two side-by-side quarries, the first has an area of 218 hectares and is on the property, unlike the second that measures 140 hectares.

    In a statement the Tunisian government   and  Bina Corp,  who are the controlling shareholders of the cement company,  said they have decided  through a tender to proceed through a public tender to sell the company to a strategic and/or a financial investor, who is capable of insuring its management and development.

    Tunisian government said the call for Expression of Interest is to guide interested investors on the pre-qualification document’s withdrawal.

    The pre-qualified candidates will be informed of their qualification next month and will be invited to withdraw the tender documents including the tender terms and conditions, information memorandum and the drafts of the share purchase agreements (SPA).

    This is besides having the opportunity to conduct due diligence, visit the plant, meet the management and propose amendments to the SPA.

  • SON, stakeholders begin review of cement standard

    SON, stakeholders begin review of cement standard

    The Standards Organisation of Nigeria (SON) has held a stakeholders’ Technical Committee Forum on the review of standard for Cement NIS 444-1-2014 with the theme: “Repositioning the Cement sub- sector”.

    The forum, which held in Lagos, comes four years after the Federal Government approved new cement standard for the producers, aimed at  reviewing the quality of the products.

    The grade-strengths of cement production in Nigeria have been NlS 444-1, adopted as conformity criteria for cement.

    The committee in the wake of  protests against the building collapse, fingered low quality of cement as a key factor. There were  fears over misapplication of the different strength classes of cement allegedly attributed as the cause of frequent collapse of buildings in the country.

    At the forum, SON’s Director-General, Mr. Osita Aboloma, noted that the exercise is “imperative as standards can be reviewed after five years or at anytime at the instance of the stakeholders or if found inadequate due to changes in technology, test methods and government policy”.

    Aboloma, represented by the Director, Standards Development, Mrs. Chinyere Egwuonwu, said cement standard is a important, given that about 80 per cent or more of buildings and other infrastructural development of any nation are carried out with the use of cement. He expressed confidence that the proposed standard will help monitor the quality of cement in Nigeria as well as checkmate the menace of incessant collapse of buildings and concrete structures by poor cement quality and application.

    Egwuonwu said this makes the review of the NIS444-1-2014 very necessary so that the country can attain world best standard, while  promoting product sales.

    She maintained that to develop a certain standard for the country certain principles must be adhered to because the country also belong to an international standard body.

    “Cement is a binder for all the components of the building and its poor application in the construction has been blamed for failures and collapse in the building and construction industry. The standard is a consensus document that promotes trade and ensure a positive impact on the national economy, if strictly adhered to. “Standard development is a stakeholders responsibility for which the SON provides the secretariat,” she said.

    The Chairman, Technical Committee for the review, Professor Joseph Odigwe, said the forum was aimed at regulating the standard of the product in the country and the concentration  is to create standard for all brands of cement in the country.

    The Founder, Building Collapse and Prevention Guild (BCPG) Mr. Kunle Awobolu, advised that government can help in the reduction of prices of cement through the provision of infrastructure such as road and electricity, adding that cost and price are as important as standard.

    The national president of block moulders association of Nigeria, Mr. Rasheed Adebowale, explained that the way cement is mixed is of great concern.

    He, therefore, called on the public and the SON to assist the association in identifying quacks in the system because they cannot do it alone.

  • Dangote sells cement on Jumia platform

    Dangote sells cement on Jumia platform

    Dangote Cement yesterday said it has taken its product to e-commerce platform, Jumia, to combat charlatans who rip off customers with fake claims about pricing.

    Key Accounts Director at Dangote Cement, Chux Mogbolu, who spoke during a press conference organised by Jumia Nigeria to unveil the milestones achieved by Jumia during ongoing Black Friday, said the partnership was between two great brands and it was designed to bring ease to customers.

    “This partnership is for life. A bag of cement on the platform is only N2,500 and it includes the cost of freighting and offloading to the warehouse of the customers. Convenience and reliability are assured. This will hopefully address online scammers who say the sell the product for N1000 per bag and never do anything. The consignment will be delivered within 48 hours,” Mogbolu said.

    He said the company would be starting the pilot project with 300 bags while hoping reduction in the minimum order quantity (MOQ) would go down in the future.

    Chief Executive Officer, Jumia, Juliet Anammah, said its 2017 Black Friday Festival has attracted more than 14 million visits since the campaign started November 13.

    The annual sales event, which was initiated in Nigeria in 2013 by Jumia remains the busiest and largest shopping day of the year on both online and offline stores.

  • Dangote Cement drives volume across Africa

    Dangote Cement drives volume across Africa

    Dangote Cement has maintained its strong hold in the   market, accounting for 65 per cent of market volume, while other African plants’ volumes went up by 7.5 per cent to 7.0 metric tonne per annum (mta).

    The cement giant has in the past months expanded its operations across Africa with the coming on stream of the 1.5 mta integrated cement plant in Mfila, Republic of Congo, even as an acting chief executive officer has been appointed for the company.

    According to the unaudited results for the nine months ended September 30, 2017, the plant, which began operations last month has almost doubled the size of the cement sector in the country. The Congo plant brings to 10 Dangote Cement plants across Africa.

    Analysis of the results, accessed by The Nation, indicated that the company recorded strong volumes in Senegal, Ethiopia and Cameroon.

    In the nine months under review, the 1.5 mta clinker grinding facility in Douala, Cameroon sold approximately 938 kilotonnes of cement, indicating an increase of 16.4 per cent on the 806 kt sold during the same period in 2016.

    The company attributed the increase in sales to a number of factors ranging from strong brand recognition, increased point of sales branding, improvements in sales and marketing strategies to higher visibility through trade shows.

    Dangote Cement Ethiopia increased sales by 16.8 per cent to nearly 1.7 mta in the first nine months of 2017, representing capacity utilisation of approximately 88 per cent.

    The cement plant in Pout, Senegal, sold 1.0 mta of cement in the period under review, up by 21.7 per cent on the comparable period of 2016. This represents almost 89 pe rcent capacity utilisation at the factory.

    Chief Executive Officer, Dangote Cement, Onne van der Weijde, said: “Our Pan-African operations are performing strongly with excellent sales growth in Cameroon, Ethiopia and Senegal.

    “We are consolidating our success across Africa and have just inaugurated our 1.5mta factory in Congo, the 10th country in which we have established operations.”

    He added that the company’s key operations in Nigeria have significantly improved its fuel mix and this has helped increase margins across the Group.

    “It is especially good for Nigeria because most of the coal we are using is mined in our own country,” van der Weijde said.

  • Cement self-sufficiency: BUA’s $1b investment to the rescue

    Cement self-sufficiency: BUA’s $1b investment to the rescue

    Nigeria’s road to self–sufficiency in cement has been long and tortuous. But her chances of achieving the target may have been brightened by the investment of $1 billion in Obu Cement Plant in Edo State by the BUA Group. Asst Editor OKWY IROEGBU-CHIKEZIE writes that the massive investment could change the economic landscape of the state and the country.

    With the investment of $1 billion in its cement plant in Okpella, Edo State, which, arguably, boasts Nigeria’s finest limestone depository, the BUA Group may have set the stage for the transformation of the state economy and, by extension, the economy.

    For one, the newly-inaugurated cement plant, which has the capacity to produce three million metric tonnes of cement yearly, is seen as a big boost and a massive intervention to address the domestic deficit in cement products for housing and construction.

    With the plant’s state-of-the-art setup seamlessly structured to facilitate the export drive, the investment is also seen as a significant boost for the nation’s cement self-sufficiency drive. BUA Group, according to its Chairman/Chief Executive Officer, Abdul Samad Rabiu, is building the second Obu cement line.

    Rabiu, who spoke at the launch of the facility, noted that the cement plant would reposition Nigeria from a cement importer to an exporter, increase production capacity from three million tonnes to 45 million tonnes by 2018.

    He said the cement sub-sector, which accounts for over 90 per cent of Nigeria’s mining sector, has the potential to shore up the $2 billion it injects into the country as foreign exchange (forex).

    Rabiu, however, said infrastructure, particularly stable power as well as policy consistency, was necessary to achieving a significant growth in the sub-sector. He said that the investment could double the sub-sector’s current 30,000 direct employment and over two million indirect jobs.

    “These kinds of investments in important sectors of the economy are not only necessary, they are critical.

    “In order to reverse our import dependency and diversify the economy, large corporations have to engage in game-changing investment in sectors such as agriculture, mining, and infrastructure, while government at all levels ensures an enabling environment for the investments to thrive,” Rabiu said.

    He said the vision of the company was to provide Nigerians with the best quality cement, using the best technology and best hands at the most affordable price. According to him, the choice of Okpella, in Estako East Local Government Area of the state, as the site for the plant, is strategic.

    “This community has the best limestone in the whole of the country,” Rabiu said, adding that the location is very good, being in the mid-west and it is very close to the cement market in the north, with excellent road networks in the south-west and to the east. “So, this place is at a strategic location to adequately distribute cement all over Nigeria,” he added.

    Rabiu also stated that the completion of the second line in the first quarter of 2018, being handled by SINOMA CBMI of China, is expected to take the company’s production capacity to six million metric tonnes per annum.

    He expressed confidence that SINOMA, with their track record and vast expertise in deploying cement plants across the world, would deliver a world-class second line for the Obu Cement Plant. “It will also meet our stringent environmental, safety, quality and technical requirements for our plants and products,” he said.

    The Obu Cement Plant utilises 9,000 tonnes of limestone and clay daily for its large-scale operations, while it produces 32.5, 42.5 and 52.5 grade cement. And the plant is engineered to be the most-environmentally- friendly cement plant in Africa with the most advanced dust emission control systems.

    “Our technology has the latest filtration with capacity of less than 10 milligram per normal cubic meter. We use natural gas, which is a very clean energy for both our kiln as well as the power plant, in addition to having a very green environment,” Rabiu said.

    At the inauguration of the plant and the ground-breaking of the second line, the Vice President, Prof. Yemi Osinbajo, pledged that the Federal Government would remove all human inhibitions to encourage investors.

    Commending BUA management for the achievement, he said the project, which is a wholly Nigerian enterprise, planned and executed by a Nigerian team, is a big boost to the economy, with the opportunities it will provide for skilled and unskilled youths of the state and the country at large.

    The Vice President noted that the plant’s output would guarantee self sufficiency of cement production for the nation, especially when BUA Group is using modern and efficient facilities with local materials. He said the company’s achievement had demonstrated that the Nigerian economic growth plan must be private sector driven.

    Osinbajo assured the private sector that the Federal Government would endeavour to make policies that would remove bottlenecks. “We will continue to create the enabling business environment and will directly assist the private sector to grow, which will in turn grow the Nigerian economy,” he said.

    According to him, the only feasible means to achieve a robust and far-reaching socio-economic development is to enable active involvement of private sector players and investors. Government resources, he said, cannot independently bridge the infrastructural and technological gap without the involvement of private sector resources.

    Osinbajo noted that advanced economies attained significance by the contributions of major entrepreneurs such as the Chairman of BUA Group. He emphasised that it was imperative to build a symbiotic relationship with committed serial entrepreneurs and investors to drive economic growth and development.

    His words: “Nation building is never judged by the number of new projects or fresh ideas that we begin; we are judged by what we complete and sustain. This country will only grow on the talent and resourcefulness of people like yourself who are ready to put their resources out and invest anywhere in the country, employ the local people in that community and add real value to the lives of Nigerians.”

    Edo State Governor Godwin Obaseki commended the management of the company for taking the bold steps in 2015 to initiate the process of establishing the plant. He expressed happiness that the management had made success of the company, including completely turning around the acquired moribund Edo cement factory.

    Obaseki said the vision and mission of the company were in line with the state government’s economic reform agenda, adding that “the State Government is ready to make Edo an industrial haven with friendly tax policies.

    He reassured the group of ensuring the operating environment was comfortable with the promotion of responsible and attractive tax regime. The state, he said, has reformed her land management process in a fashion that makes acquisition of land, security of approvals and building permit feasible without social harassments or uncontrolled communal land administration.

    Obaseki said: “We want to use this opportunity to invite other investors to emulate the BUA Group, come to Edo State and take advantage of the great potential in the state. Edo State is rich in limestone and other solid minerals, besides its status as an oil producing state. Government is resolute about economic diversification especially into areas where we have competitive and comparative advantage.”

    The governor also informed that his administration has created the enabling business environment for potential investors to invest in an industrial park, located in Ologbo, in Ikpoba Okha Local Government Area of Edo State, where the gas transmission line and proximity to power is expected to boost economic activities and create investments in the state.

    “We are currently designing an export processing zone with the initiative of investing in the Gelegele Port to boost production and agriculture, which is the major thrust of both the Federal and Edo State Governments’ economic diversification programme,” Obaseki added.

     

    How the BUA journey began

    The acquisition of a two million tonnes floating cement terminal labelled BUA Cement 1 in 2008 marked the company’s entry into the Nigerian integrated cement manufacturing. It was the first time the industry experienced a technology driven bulk-bagging of cement on a vessel.

    It acquired majority stake in the publicly listed Cement Company of Northern Nigeria PLC (CCNN), as well as in Edo Cement Company Limited in the same year before investing in the construction of a Greenfield three million tonnes plant in Obu.

    On the acquisition of CCNN, Rabiu said: “BUA’s investment in the cement line in Sokoto is the single largest private sector led investment in the North-Western part of Nigeria.

    “This is particularly important because Sokoto cement was the largest employer of labour in Sokoto State after the State Government, and the 60-year-old company founded by the Sardauna of Sokoto needed that investment to keep those jobs.”

    The effectiveness and efficiency of the plant in its first year of operation, which was over 90 per cent in an industry where efficiency averaged 60 per cent, led BUA to commence the construction of a second cement plant line of three million tonnes.

  • Price of cement to crash, says BUA chief

    Major producers of cement in the country are working hard to reduce the cost of the product as soon as possible, BUA Cement, has assured.

    Its Chairman, Alhaji Andulsamad Isyaku Rabiu gave State House correspondents the assurance after a meeting with Acting President Yemi Osinbajo in Abuja yesterday.

    According to him, some factors which led to the high cost of cement are already being addressed.

    He said the foreign exchange (forex) situation in the country and the high cost of Low Pour Fuel Oil (LPFO) were largely responsible for the escalating cost of cement in the country.

    Stressing that the forex situation has now improved dramatically, he said the cost of LPFO used by some cement companies including one of BUA’s plants in Sokoto has also come down.

    The reduction of the the cost of cement, he said, would happen in the near future.

    He said: “The cement production requires quite a lot of energy. That is quite a significant part of the cost of cement production. That has been addressed to mainly the price of oil, may be the price of LPFO that we use has come down. I’m talking about Sokoto now.

    “Of course, the other cement plants scattered all over the country like may be the southern part of the country are using gas which is actually much cheaper. But for Sokoto, for example, we are using LPFO and LPFO is quite expensive.

    “We have to transport it either from Lagos or from Kaduna refinery if there is availability. That, you know, from time to time, impacts on the cost.

    “But I can assure you that the three major companies producing cement in Nigeria are working very hard to see that the price of cement comes down in the very near future.

    “We are trying very hard to make sure the price comes down. Of course, the foreign exchange aspect also improved dramatically. That, as we all know, was a big issue. Now, that has improved considerably.

    “So, I think we will see quite a reduction in the very near future.”

    He said he was in the State House to discuss cement policy issues with Acting President Osinbajo and to invite him to commission BUA Cement Sokoto plant that has almost been completed.

    “Well, I don’t think am here to discuss policies. Rather, the reason why I came here is to come and pay respect to the Acting President and to also solicit for his support in commissioning one of the projects that we are doing. That’s why I came here.

    “It is a project that we have actually almost completed in Sokoto. It is Sokoto Cement and we are hoping to commission the plant very soon. We discussed that and he is looking into it and he’s promised to get back,” he said.

  • Cement production: Nigerian firm leads in push for Africa’s self-sufficiency

    Cement production: Nigerian firm leads in push for Africa’s self-sufficiency

    Africa is inching closer to self-sufficiency in cement production. A multinational, Dangote Cement Plc, is at the forefront of the ambitious drive, with plans to start production at its $300 million cement grinding plant in Congo. Assistant Editor OKWY IROEGBU-CHIKEZIE, who was part of a guided tour of facilities at the Congolese plant, reports.  

    With gradual closure in the demand and supply gap of cement in Africa, the construction industry is witnessing a dramatic turnaround. It is in the area of product manufacturing, importation, packaging and distribution.

    The turnaround is expected to throw the continent into the realm of self-sufficiency in cement.

    Besides, meeting the prevailing demand in the construction market, the revolution is saving the continent huge foreign exchange on importation, as well as boosting employment opportunities.

    In Congo Brazzaville for instance, an indigenous multinational, Dangote Cement Plc and Africa’s driver of self-sufficiency target in cement, plans to create more than 1,600 direct and indirect jobs. The company’s $300 million plant will soon begin cement production.

    According to Plant Director for Congo Operations, Mr. Ganapathy Balasubramanian, the multi-million dollar investment will significantly boost the economy of the Francophone nation and its neighbours after completion.

    The 1.5 million metric ton-capacity plant, located in Bouansa, Congo Brazzaville, is billed for completed soon. Balasubramanian also spoke of plans to boost to raise the plant’s production capacity by 1.5 million metric tons, bringing it to three million metric tons.

    Speaking during a guided tour of the ultra-modern plant, Balasubramanian said the factory, built on an 80-hectare land, will not only meet the nation’s cement demand, but cater for the export market in countries in Central Africa.

    The plant director, who put the project cost at CFA 133 billion (about $300 million), told reporters that factory will get it’s 20 megawatts power needs from Congo’s national grid.

    He also informed that the factory has a potential utilisation profile of 99 per cent when upon completion. The Congolese are the latest in the list of Africans to be excited by prospects of massive job opportunities and significant boost in Gross Domestic Product (GDP) following investment by Dangote Cement Plc.

    The Central African nation is the latest to join the clubof beneficiaries of the cement giant’s strategic investments across 16 African countries where it targets to achieve a total cement production capacity of 75 Million Metric Tonnes Per Annum (MMTPA) by 2019.

    Some of the strategic investments targeted at changing the narrative of Africa’s cement market from dependency on importation to self-sufficiency include: 1.5 million MTpa in Senegal, Zambia’s 1.5 million MTpa (Green-field projects), Tanzania’s 1.5 million MTpa, South Africa’s 2.2 millon MTpa, Ethiopia’s 1.5 million MTpa and Cameroun’s 1.5 million MTpa cement grinding plant.

    The company also has cement terminal operations in Ghana (3.0 million MTpa); Sierra Leone (0.5 million MTpa); Ivory Coast (1.0 million MTpa) and Liberia (0.5 million MTpa).

    It was learnt that many of the countries limestone deposits, the essential component for cement production in commercial quantity.

    The nationals are thrilled by the deposits because of their spin-offs, especially in the area of job creation.

    It was the same sentiment in Ethiopia where the inauguration of a 2.5 million MTpa cement plant in the East African country in 2015 was expected to create over 7, 000 jobs. There were also plans to double the plant’s capacity before the end of that year.

    At take-off, about 2,000 people were directly employed in the main plant operation and 5,000 others indirectly engaged.

    Speaking at the inauguration, President of Dangote Industries Limited (DIL), Alhaji Aliko Dangote,   charged African leaders to create a conducive environment for real sector growth, noting that doing so remained the best to create jobs and to reduce poverty.

    Dangote also stressed the need for genuine collaboration between the private sector and governments at all levels for the much-needed real sector growth, noting that there must be deliberate efforts to encourage Africans, not just foreigners alone, to invest in Africa.

    He said: “Take for example, my company, the Dangote Cement, is currently investing in 16 African countries, with plans to invest in many more over the next few years. We need to encourage this trend to see more investments in Africa by Africans.

    “Above all, there is the need to encourage the private sector to collaborate with governments across Africa, to address the issue of infrastructure deficit, which has plagued the continent for decades.”

    According to him, “manufacturing, and not trading, is the best way to grow an economy.”

    “This event, which we are witnessing today, attests to the fact that we took the right decision when we decided to transit from trading in our home country, Nigeria, into manufacturing, in 1996”, he said.

    Dangote, who is Africa’s richest man, noted that his investments in new cement plants and terminals across 16 African countries were in line with his company’s long-term vision to become one of the world’s biggest cement producers.

    “We envisage that by the time we complete all our ongoing African projects, we will be on track to achieving our target”, he said.

     

    Nigeria’s cement market leads

    No doubt, the Nigerian cement market where the multi-billion dollar investor started his investment drive across the continent remains the biggest and most impactful. The total production capacity of the company’s three plants is 20.25 MMTPA.

    The plants are: Obajana in Kogi State (10.25 MMTPA), Ibese in Ogun State (6.0 MMTPA) and Gboko in Benue (4.0MMTPA).

    The Obajana Cement Plant (OCP) is believed to be one of the single largest cement plants in the world with a combined 10.25MMTPA capacity. It added a fourth line of 3.0 MMTPA to two years ago. Apart from a 135 mw capacity power plant, the cement plant has a gas pipeline of approximately 90-kilometre length for natural gas supply.

    The company also recently inaugurated its factories in Okpella, Edo State and Itori, Ogun State. According to Dangote Group Executive Director, Strategy, Projects and Portfolio Management, Devakumar Edwin, the Okpella plant will have two cement lines, which will with capacity for three mmtpa each.

    On the other hand, the Itori plant, he said, will deliver approximately three mmtpa from two production lines. Both plants are expected to come on stream next year.

    He said the proposed plants would add 12 mmtpa to the company’s current local output of 31.25mmtpa, raising its total output to 41.25mmtpa.

    Explained that the company’s expansion drive, Edwin said it was targeted at reducing transportation and production costs, adding that it would on the long run bring down price and more employment opportunities for youths in the host communities.

    Other outlets of Dangote Cement are: Lagos Cement Terminal, Port Harcourt Cement Terminal, Onne cement terminal, Aliko Inland Cement Terminal and Continental Cement Terminal. The terminals have combined capacity of nine mtpa.

    On account of its local investments in Nigeria, Dangote Cement is said to control about 65 per cent of the market and over 30 per cent of the Nigerian Stock Exchange (NSE).

    According to Dangote, the group’s cement production has surpassed Nigeria’s average total consumption of 20 million metric tonnes.

    The Nation learnt that Dangote’s strategy for Africa is to achieve a total capacity of 75 MMTPA by 2019. Officials of the company, who spoke in Congo, said that this will make the company a global force to reckon with in cement production.

    They hinged their optimism on the fact that the company has unique footprints in cement production across Africa.

    Experts have traced the rising demand for the commodity in Africa to massive infrastructural developments in many countries.

  • Lafarge trains host communities on cement; offer employment

    Lafarge trains host communities on cement; offer employment

    In its continued bid to further impact on its host communities, building solutions provider, Lafarge Africa Plc, has concluded arrangement to further empower indigenes of its operating areas.

    To this end, 15 youths from Ogun, Gombe and Cross River states have been enrolled in the maiden Cement Professional Technician Programme (CPTP). The programme involves the training of youths in the cement manufacturing process.

    The three-year all-expense-paid residential programme includes training in mechanical, electrical, instrumentation and automation technology, cement manufacturing process and entrepreneurship. The selected youths will receive practical and theoretical training at Lafarge Africa’s state-of-art centres and plants in Ashaka, Ewekoro, Mfamosing (Calabar) and Sagamu. Participants who successfully complete the training will be offered automatic employment within Lafarge Africa.

    The Communications, Public Affairs and Sustainable Development Director of Lafarge Africa, Mrs. Folashade Ambrose-Medebem, at the launch of the programme at Ewekoro, Ogun State, said the initiative will increase the local content of Lafarge’s operations in the country and also bridge the skills gap in the cement industry.

    She explained that the programme is in partnership with the National Board for Technical Education (NBTE), Industrial Training Fund (ITF) and the National Consultative Assembly (NECA); the certificate awarded after the programme is accredited by National Board for Technical Education (NBTE), and is valid for admission into any Nigerian university.

    Ambrose-Medebem, who represented the Lafarge Africa’s Country Chief Executive Officer, (CCEO), Mr. Michel Puchercos, noted that the Cement Professionals Training programme is a Corporate Social Responsibility (CSR) initiative hinged on the firm’s five pillars of health, safety, education, infrastructure as well as clean environment.

    Shedding more light on the programme, the Health & Safety Director, Lafarge Africa, Mr. Graeme Bride, noted that the selected youths will be trained to imbibe the culture of “Safety First” as it operates in any Lafarge facility.

  • $300m Dangote Congo cement plant coming

    $300m Dangote Congo cement plant coming

    Dangote Cement Plc has announced plans to commence production at its cement grinding plant in Congo in a matter of weeks this month.

    Almost completed, the company hopes to boost its production capacity by at least 1.5 million metric tons, to bring its total yearly manufacturing capacity to about 32 million tons across Africa.

    According to the company, the completion of a new cement manufacturing line at Bouansa, Congo brings the company closer to its goal of being the major exporter of cement in the continent.

    The new plant is coming on the heels of the ongoing construction of a new three-million metric tonnes capacity cement grinding plant in Cote D’ivoire.

    Plant Director for Congo Operations, Ganapathy Balasubramanian explained that the factory which costs the company CFA 133 billion or about $300 million, is expected to meet the nation’s cement demand and cater for the export market in neighbouring countries within the region.

    The project, according to him, is sitting on 80 hectares of land and is expected to strengthen the nation’s economy.

    “Satisfying the current demand of the construction market in general, saving foreign currency expenditure and generating employment opportunities, are some of the benefits of this project,” he added.

    The grinding plant, made up of 1.5 million metric tons capacity,  when it commences operations, will increase the total capacity of local cement production in the Francophone nation and provide direct and indirect jobs for over 1,600 people from within the country and other neighbouring countries.

    Balasubramanian added that the company will be depending on an on-grid power system in meeting its energy needs, as 20 mega wattsis being supplied from the national grid, stressing that the factory has a potential utilisation profile of 99 per cent when it commences operations.