Displaying items by tag: Egypt

Encouraging news from Egypt with the announcement that Lafarge Ecocem has taken on two refuse-derived fuels (RDF) contracts in Suez and Qalyubeya. The RDF plants will have production capacities of 42,000t/yr and 280,000t/yr respectively, after upgrades are built.

The move follows a deal Lafarge struck with Orascom in March 2015 to develop a waste management framework of municipal and agricultural waste. The plan is to achieve an average fuel substitution rate of 25% by the end of 2015. Around the same time Ecocem also signed a cooperation agreement with the German Development Cooperation (GIZ) and the Qalyubeya Governorate to upgrade a recycling plant in Qalyubeya to produce RDF. Part of the deal was intended to reinvest some of the revenue from RDF sales back into the region's waste collection infrastructure.

These production levels compare to SITA UK's new RDF plants in the UK, which has a more mature RDF market. There, the newly opened Malpass Farm plant is planned to produce 200,000t/yr and the Tilbury plant will have an output capacity of 500,000t/yr when it opens. However, the Malpass Farm plant mainly feeds one cement plant, the 1.3Mt/yr Cemex Rugby plant with a mean substitution rate of 61% in 2013. By contrast, Lafarge Cement Egypt runs the massive 10.6Mt/yr El Sokhna plant.

Co-processing at El Sokhna by Lafarge is of particular interest given the links with Egypt's unofficial household waste collectors, the Zabbaleen. Lafarge Egypt recruited and trained 140 Zabbaleen to gather waste material for RDF production. The strategy enabled Lafarge to gather continuous supplies of RDF and strengthen local stakeholder relations, as Lafarge's 2013 sustainability report puts it. Lafarge Egypt's substitution rate was 2.2% in 2012 with significant improvements made since then. The current target of 25% for the end of 2015 shows how much progress Lafarge has made.

Hisham Sherif of the Egyptian Company for Solid Waste Recycling (Ecaru) placed Egypt's municipal solid waste level at 20Mt/yr at a presentation given at the Global CemFuels Conference earlier in 2015. From this 4Mt/yr of RDF could be produced. Together with biomass derived fuel (BDF) Sherif reckoned that the country's cement plants could reach substitution rates of 30 – 40%. Problems though with increasing RDF rates in Egypt include legal complexities, institutional issues, poor services and monitoring and centralised planning with little regard for the country's unofficial waste pickers, such as the Zabaleen.

Lafarge Ecocem appears to be tackling each of these problems in turn as the deals with Orascom and the Qalyubeya Governorate show. However, spare a thought for Egypt's unofficial waste sector workers who are likely to lose their livelihoods as waste management becomes more formalised and personnel rates per tonne of waste collected tumble.

For more information on the Zabaleen, check out the documentary made about them in 2009, called 'Garbage Dreams'.

Egypt: Arabian Cement reported an 11% year-on-year increase in revenues to US$76.7m during the first quarter of 2015. This, however, did not lessen the significant drop in the company's net profits, which plummeted by 52% to US$7.34m. Earnings before interest, taxes, depreciation and amortisation (EBITDA) fell by 19% year-on-year to US$24.1m. Profit before tax declined by 45% to US$11.3m.

The company said that higher transportation costs led to higher costs of production and impacted the quarterly results. The company added that the devaluation of the Egyptian Pound against the US Dollar had influenced the company's foreign losses, which surged to US$4.06m in the first quarter of 2015, compared to a US$301,422 loss in the same period of 2014.

Arabian Cement said that, despite it being a tough quarter, it had succeeded in operating at above 90% clinker capacity and also increased its sales volume. Its market share also grew by 1%, rising from 7% in the first quarter of 2014 to 8% in 2015.

Egypt: Lafarge Industrial Ecology (Ecocem) has signed two major contracts to manage and operate existing refuse-derived fuel (RDF) platforms in Suez and Qalyubeya in Egypt.

In an effort to continue its efficient waste management processes, the company has signed a year agreement to renovate and upgrade the platforms in Suez and another separate 10-year agreement to manage and operate the existing platforms in Qalyubeya. Lafarge Ecocem has already added a new production line to the Suez platform and plans an additional line within one year of signing its contract with the governorate. The plant will produce 42,000t/yr of RDF and the investment will total US$1.66m.

Ecocem has also already added an extra line to the Qalyubea plant, in addition to renovating one production line. The company's future investments in the governorate will increase the RDF production capacity by 32,000t/yr to 280,000t/yr. Both investments at the Qalyubeya plant were funded by GIZ and the Bill and Melinda Gates Foundation with a total Investment of US$1m.

"In line with our 'Building Egypt 2030' campaign, Lafarge is committed to help solve the issue of waste in Egypt and to continue taking the necessary steps towards sustainable development," said Hussein Mansi, CEO of Lafarge Egypt. "At Lafarge Egypt, we feel it is our responsibility as a leader in building solutions to be the major proponents in waste management and plan to continue finding many opportunities to make a difference."

Building on its waste management strategy, Lafarge Ecocem is committing to several additional long-term contracts with different governorates to help convert municipal solid wastes to alternative fuels. In addition, in March 2015, Lafarge Egypt and Orascom Telecom Media and Technology Holding S A E signed a memorandum of understanding to develop a waste management framework of municipal and agricultural waste.

Lafarge Egypt and Ecocem have implemented many projects over the past three years in order to increase the use of alternative fuels and aim to achieve an average fuel substitution rate of 25% by the end of 2015. More than 260,000t of waste have been processed and fired in Lafarge's Sokhna plant since 2013, an equivalent of 100,000t of fossil fuels.

Egypt: Arabian Cement has reported that in the first three months of 2015, which ended on 31 March 2015, its net profit fell to US$7.52m versus a net profit of US$15.3m a year earlier.

Egypt: Suez Cement plans to increase its energy intake and its production capacity by 15%, according to Bruno Carrè, the company's managing director in Egypt. He added that the company would not file a request to obtain a new cement licence. Suez Cement will convert two new facilities in 2015, adding to two facilities converted in 2014. "We are investing US$52.4m/yr for four years," said Carrè.

Carlo Pesenti, the CEO of Suez Cement's mother company Italcementi, said that the company is currently focusing on energy source diversification at its Egyptian facilities. Pesenti said that the company "Has capacity to increase the volume of investments in Egypt." It is currently investing US$15.7m to build a wind farm that will be deployed in the next two years.

Egypt: Sinai Cement has reported a net loss of US$1.43m for the first quarter of 2015, which ended on 31 March 2015. In the same period of 2014 it posted a net profit of US$4.67m. Meanwhile, Misr Beni Suef Cement has reported a net profit of US$4.59m for the first quarter of 2015, which ended on 31 March 2015. In the same quarter of 2014 it posted a net profit of US$6.67m.

Egypt: Investments worth US$30bn in the coal industry are expected to be conducted within the next five years, according to Egypt's investment minister Ashraf Salman.

Salman said that there is 'full coordination' between the ministries of environment, electricity and investment to adhere to international environmental standards when using coal. Egypt's cabinet announced new rules on coal use in April 2015, which stipulate that coal imports can only take place after approval from the ministry of environment. The new rules are an amendment to a law on environmental affairs and allow the use of coal for cement, iron and steel, coke and aluminium production and in power plants.

Salman said that using coal as an energy source would decrease the dependency on natural gas as a primary energy source and petroleum products in steel and cement production. Despite the energy crisis, which has caused frequent and numerous power outages for years, the cabinet's approval of new coal use has caused controversy both within the government and outside.

Egypt: 90% of cement plants have agreed to use coal to increase their cement production, according to Egypt's Industrial Development Authority.

The authority is facilitating plant upgrades to enable coal use and ensuring that the necessary quantities of coal can be supplied, according to the head of the Industrial Development Authority, Ismail Gaber. He added that Egypt needs more than 32Mt/yr of cement to meet the needs of the domestic market.

In light of the population increase, the demand on energy has significantly increased in Egypt in recent years. The government agreed to include coal in the cement industry energy system in April 2014. Prior to that, coal was used only in the iron and steel, coke and aluminium industries. It is now also allowed to be used for electricity and cement production.

Striking news from Libya this week with the announcement that an investor with international backing wants to buy the majority stake in the Libyan Cement Company.

Libya holdings owner Ahmed Ben Halim is in the process of buying out the Austrian Group Asamer that originally bought a majority share for US$145m back in 2008. Most of the remaining share was owned by the Economic and Social Development Fund. Taking over the company now seems bold from a European perspective or Ahmed Ben Halim got a very good price. No financial information regarding the deal has been made public.

Libya has remained politically unstable since the civil war in 2011. According to the Libyan Herald, following the war a strike at the Libyan Cement Company's plants for lost wages stopped production. Since then two of the three cement plants the company runs in east Libya near Benghazi have remained shut due to their proximity to fighting with the Ansar Al-Sharia militia. Before the civil war in 2011 the Libyan Cement Company had a combined cement production capacity of 6Mt/yr almost half the USGS estimated production for the entire country in that year.

The Libyan Cement Company's plants are all located in the east of the country under the nominal control of the Council of Deputies based in Tobruk. Its two plants in Benghazi have remained shut due to their proximity to fighting with the Ansar Al-Sharia militia. A third plant near Derna has also had security issues. Halim told the Financial Times that he was not 'crazy' to be investing at this time. "We have a long-term strategic plan" he said, "that Libya's going to rebuild its infrastructure. And a key element of this is cement." If he can hold out until the rebuilding starts then he may just be right.

Meanwhile across the border in Egypt, Minister of Supply Khaled Hanafy announced this week that cement prices had remained 'stable' for the fifth month in row. Some commentators placed improved energy supply security at the heart of this situation allowing producers to build up inventory. However, given the situation in Libya, it is worth considering what will happen once Libyan demand for cement does pick up both in competition for energy supplies like coal and a keener export market.

Finally, our editorial director Dr Robert McCaffrey was at the IEEE-IAS/PCA Cement Conference in Toronto, Canada this week. Here's his snapshot of PCA economist Ed Sullivan's forecast for future US cement supply and demand.

Ed Sullivan's forecast for future US cement supply and demand, at IEEE in Toronto. pic.twitter.com/RUoT7uHGtg

— Robert McCaffrey (@DrRobMcCaffrey) April 28, 2015

The UK London Underground has 'mind the gap' as its well-known warning phrase to prevent passengers falling between the platform and the trains when boarding. The favourable supply gap Ed Sullivan is talking about in US will be one cement producers will definitely not want to miss.

Egypt: Cement producers have decided to keep the prices of cement 'stable' for the fifth consecutive month, Minister of Supply Khaled Hanafy has announced. Medhat Stephanos, head of cement companies at the Federation of Egyptian Industries (FDI), said the supply surplus is behind the price stability, according to local media.

Hanafy stated that 854,000t had been produced for the current month and that the total amount of supplied cement was 1.86Mt. Around 818,000t of cement were distributed in the local market and around 500,000t were exported between 9 and 15 April. Staphanos added to Daily News Egypt that the country's cement production capacity has increased following the introduction of coal as a source of energy, which reduced the energy problem that faced producers.

"We expected more activity in the processes of construction but those expectations were not met," said Stephanos. "Some projects were expected to start but have not started yet."