Ethiopia: Mugher Cement Enterprise is considering proposals from two Chinese suppliers for a turnkey project to convert its current heavy furnace oil (HFO) clinker burning system to a coal-fired system. Mekonnen Zergaw, CEO of the state-owned Mugher, declining to disclose the names of the companies. He said that five companies had participated in the bid, of which one has been disqualified at the beginning while two companies did not pass the technical evaluation.

This is the second time Mugher has accepted tenders for the upgrade. Originally Mugher awarded a US$28m contract to Chinese firm Hefei Cement Research Design Institute (HCRDI) that built the same project for the EFFORT Messobo plant. "The company increased the bid by around US$11m after we had already awarded it," said Zergaw.

Mugher plans to complete the coal-fired furnace by the 2013-2014 fiscal year and its demand for coal is estimated to be 693Mt/yr. However, Mugher is still waiting for the approval of a US$33.2m loan request from the Commercial Bank of Ethiopia. The Ethiopian government instructed cement factories in 2010 to shift from HFO to other alternative sources of energy in order to reduce foreign currency spending.