September 2024
Potential merger of Ambuja Cement, ACC and Lafarge India 19 February 2015
India: Ambuja Cement, ACC and Lafarge India may merge as part of the proposed global merger of Lafarge and Holcim, according to local media. The plan is still at an early stage and LafargeHolcim have mandated investment bank Lazard to advise on the restructuring of their Indian operations. The most likely option is the merger of ACC, Ambuja and Lafarge India into one listed entity to create the largest cement company in India. The combined cement production capacity of the three subsidiaries would be some 70Mt/yr.
As part of the new restructuring proposal, LafargeHolcim may reassess Holcim's restructuring of ACC and Ambuja, which was announced in 2014 and is currently incomplete. As part of the plan, shareholders of Ambuja had approved ACC's stake acquisition from Holcim.
Aditya Birla’s Hindalco Industries wins another coal mine in auction 19 February 2015
India: Aditya Birla's Hindalco Industries has won the Gare Palma IV/5 mine in Chhattisgarh, outbidding a number of companies, including Ambuja Cements, on day five of India's coal mine auction. The winning bid was US$56.4/t and the mine has extractable reserves of 42.4Mt. This is Hindalco Industries' second winning bid in the auction.
MCL to restart Cherthala grinding plant 19 February 2015
India: Malabar Cements Limited (MCL) will resume operations at its Cherthala grinding plant in Alappuzha, Kerala on 26 February 2015. Managing director K Padmakumar said that a ship carrying 27,010t of clinker intended for the plant had reached the Cochin port from Fujairah, UAE.
Padmakumar said that the Cherthala plant would have 600t/day of capacity and required 1.2Mt/yr of clinker. The plant stopped functioning in 2009 due to a shortage of clinker, though its profit was around US$644,000/yr. MCL's Walayar cement plant in Kerala was not able to share its clinker production with the Cherthala plant.
Clinker is now sourced through e-tenders. The company that won the e-tender has assured the management of uninterrupted supply of clinker throughout the year. The price is lower than the clinker it previously sourced from the Cement Corporation of India. "As per the arrangement, MCL can save US$16.1/t," said K Abdul Samad, chief mechanical engineer of MCL. With the Cherthala plant back on stream, the production capacity of MCL would grow to 200,000t/yr.
Agreement between McInnis Cement and the Centre québécois du Droit de l’Environnement (CQDE) 19 February 2015
Canada: McInnis Cement has reached an agreement with the Centre québécois du Droit de l'Environnement (CQDE) regarding the proceedings filed in August 2014 against the Environment Minister, aimed at invalidating McInnis Cement's authorisation certificate for its cement plant project in Port-Daniel–Gascons. McInnis Cement and the CQDE have agreed to create an environmental subcommittee and to pursue discussions in a mediation process that will address three issues:
1. The monitoring of greenhouse gases (GHG) from the cement plant and McInnis Cement's efforts to reduce GHG;
2. The monitoring of McInnis Cement's performance in complying with the National Emission Standards for Hazardous Air Pollutants (NESHAP) standards with regards to the emission of contaminants;
3. The monitoring of McInnis Cement's compliance with the protocol agreed to with Fisheries and Oceans Canada concerning the protection of marine mammals.
In addition to the CQDE, the Conseil régional de l'Environnement de la Gaspésie-Îles-de-la-Madeleine and Nature-Québec have been invited to the mediation process, as well as the Ministère du Développement durable, de l'Environnement et de la Lutte aux Changements climatiques. The work of the enlarged forum will ensure a long-term dialogue around the future cement plant and is part of McInnis Cement's sustainable development values.
"From day one of Lafarge's filing of the request, McInnis Cement stated that it was a maneuver to slow the arrival of a competitor in the market. The withdrawal of the environmental groups is leaving Lafarge alone in the legal proceedings and highlight its non-competitive purpose," explained Christian Gagnon, CEO of McInnis Cement. "McInnis Cement is aware of its carbon footprint and is committed to gradually reducing its GHG. In this context, we choose the path of dialogue, opting for a mediation with environmental groups about this global issue," said Gagnon.
Indocement expects 6% higher sales volumes in 2015 18 February 2015
Indonesia: PT Indocement Tunggal Prakarsa expects sales volumes to grow by 6% in 2015, according to CEO Christian Kartawijaya. The company reported cement sales of 18.8Mt in 2014, up by 3% from 2013. It will invest up to US$391m on capital expenditure in 2015. The company's 14th plant in West Java is expected to start operating in the third quarter of 2015.
Semapa's 2014 profit fell by 23% 18 February 2015
Portugal: Portugal's conglomerate Semapa, which owns cement maker Secil and pulp and paper producer Portucel, has posted a 23% fall in its 2014 net profit due to tax adjustments and a financial loss. Semapa's net profit fell to Euro113m in 2014. Earnings before interest, taxes, depreciation and amortisation (EBITDA) fell by 2.6% year-on-year to Euro410m. Total sales rose by 1.5% to nearly Euro2bn, with cement sales up by 5%.
Vietnamese government agrees extra cement production capacity 18 February 2015
Vietnam: The Government of Vietnam has approved the Ministry of Construction's proposal to increase the capacity of two cement plants in Ha Nam and Nghe An Provinces.
The Thanh Liem Cement plant in Ha Nam Province's Bong Lang Commune will be upgraded with an additional 2.3Mt/yr capacity production line, which is expected to open in 2018. Currently, the plant has just one production line with 450,000t/yr of cement production capacity. Nguyen Quang Bay, director of the Thanh Liem Cement plant, said that it was necessary to increase the capacity of the plant in order to fully exploit the limestone resources in the province.
The Song Lam Cement plant, which is currently under construction in Nghe An Province's Bai Son Commune, will now have 4Mt/yr of cement production capacity when complete. Construction on the plant began in February 2015 with investment capital of US$494m. Three production lines will be built by 2020. The first two are scheduled to be put into operation in 2017.
Prime minister Nguyen Tan Dung asked the Construction Ministry to re-examine cement plant projects in the 2011 - 2020 period and forecast market demand, then report it to the Government later in 2015. Cement consumption reached 5.87Mt in January 2015, an increase of 30% compared to January 2014, according to the Construction Ministry's Building Material Department. Domestic cement production currently meets demand, according to the department.
The Vietnam Cement Association predicts that cement exports in 2015 could earn as much as US$1bn via the export of 20 - 21Mt of cement and clinker, a 15% increase in value year-on-year.
Cemex guaranteed 35% stake in Trinidad Cement 18 February 2015
Trinidad & Tobago: Cemex has struck a deal with the board of Trinidad Cement Limited (TCL) that will allow Cemex to increase its stake in TCL to at least 35%, with the option to add another 5%.
Cemex SAB de CV currently owns 20% of TCL, the maximum that was allowable per shareholder, through Sierra Trading. It has committed not to seek a stake higher than 40% of TCL under an accompanying deal to an upcoming rights issue. The deal, referred to as a Subscription Agreement, was signed by Sierra and TCL on the same day that TCL's shareholders voted to remove the cap on ownership of TCL shares.
Sierra will take up its full allowable allotment under the rights offer that gives shareholders the option to acquire one additional share for every two held. Some 124,882,568 shares will be available for subscription. If Sierra fails to reach its 35% ownership target at the close of the offer, "Then subject to receiving all required approvals, including shareholder approval, a private placement of TCL shares will be issued in favour of Sierra Trading in an amount that will permit Sierra Trading to achieve a shareholding of 35% of TCL's outstanding shares," said a Trinidad Cement spokesperson. The TCL board, under the leadership of chairman and shareholder Wilfred Espinet, also signed off on an 'exclusive' plan for Sierra to buy up the TCL shares that are not taken up during the rights offer, but under terms where Sierra's stake does not exceed 40% of the publicly traded company.
The ownership structure of TCL is undergoing changes that, according to the board, will facilitate a new debt-restructuring plan under negotiation with creditors. The loan agreements of 2012 that lengthened the maturity profile of the debt by six years were placed on hold by the current board while it negotiated a new deal. Consequently, TCL's US$315m of long-term debt was reclassified as short-term obligations.
Jaiprakash Power Ventures wins coal block on day four 18 February 2015
India: On the fourth day of India's coal block auctions, on 17 February 2015, Bharat Aluminium Co bid US$48.5/t to beat rivals Hindalco Industries and UltraTech Cement, among others, to win the Chotia mine in Chhattisgarh. The block has Grade C coal reserves with 1Mt/yr of production capacity. The price of imported coal of a similar grade is around US$72.2/t.
Jaiprakash Power Ventures won the Amelia North coal block in Madhya Pradesh for US$11.4/t, while agreeing to forego the mining cost. The mine has extractable reserves of 2.8Mt/yr and was previously owned by Madhya Pradesh State Mining Corp. OCL Iron & Steel won the Ardhagram mine in West Bengal at a price of US$36.9/t. The mine has extractable reserves of 400,000t/yr.
Canada: The Cement Association of Canada (CAC) has welcomed the British Columbia government's efforts to improve the Province's carbon tax. The British Columbia Carbon Tax is applied only to domestically-produced cement, while imported cement from the US and Asia is exempt, resulting in a net loss to the British Columbia economy. With local manufacturers facing higher costs under the carbon tax, cement imports from jurisdictions without a carbon policy have risen significantly.
The proposed 'transitional incentives,' of US$22m paid over a three year period, to encourage the British Columbia Cement industry to adopt cleaner fuels and further lower emission intensities will assist the current inequality that the industry faces as a result of imports coming from the US and Asia into British Columbia with no carbon tax applied. The cement industry has been working with the British Columbia government and other stakeholders for many years to find a win-win solution to protecting jobs, economic development and the environment.
"British Columbia produces some of the highest quality cement in the world, so the change makes sense both for the environment and for the Province's continued economic prosperity. British Columbia cement is a strategic commodity and a key component of concrete, which is essential to the implementation of the government's ambitious plan for infrastructure development," said CAC president and CEO Michael McSweeney.
"This incentive will help level the playing field for domestic producers of cement. It assists our company to ensure that good jobs stay and continue to be created in British Columbia," said Bob Cooper, vice president of Lafarge Western Canada. "Our competitiveness has been threatened by imports for the past five years and the move by the British Columbia government will also ensure that British Columbia has a long-term and secure local supply of made-in-British Columbia cement."