Displaying items by tag: Heidelberg Materials North America

A week ago, there were two fully-financed cement plant carbon capture, utilisation and storage (CCUS) projects underway in the US.¹ Now, there aren’t.

Projects to decarbonise National Cement Company’s Lebec, California, plant and Heidelberg Materials North America’s Mitchell, Indiana, plant were each set to receive up to US$500m in US Department of Energy (DoE) funding on a one-for-one basis with private investments. The projects were to include eventual 950,000t/yr (Lebec) and 2Mt/yr (Mitchell) carbon capture installations. Additionally, the Lebec plant was to transition to limestone calcined clay cement (LC3) production and the use of alternative fuels (AF), including pistachio shells. Both were beneficiaries of the DoE’s US$6bn Industrial Demonstrations Program (IDP), touted by former US Secretary of Energy Jennifer Granholm as ‘Spurring on the next generation of decarbonisation technologies in key industries [to] keep America the most competitive nation on Earth.’ Disbursement of funding under the programme was frozen by executive order of President Trump in January 2025.^{2, 3}

On 30 May 2025, Trump’s Secretary of Energy announced that the government in which Granholm served had approved spending on industrial decarbonisation without a ‘thorough financial review.’ He cancelled remaining project funding in signature Trumpian style, in list form.⁴ Among 24 de-funded projects, Lebec and Mitchell accounted for US$1bn (27%) of a total US$3.73bn in allocated funds that have now been withdrawn.

It's hard not to feel sorry for the management of the Lebec and Mitchell plant and the teams that had been working to deliver these projects. Heidelberg Materials has yet to comment, though CEO Dominik von Achten was in North America in late May 2025. National Cement Company parent Vicat, meanwhile, conceded the setback with a strong statement of its commitment to CO₂ reduction, to 497kg/t of cementitious product globally.⁵ There was a diplomatic edge to the statement too, however. Echoing the Secretary of Energy, Vicat said that its target remains ‘solely based on existing proven technologies, including energy efficiency, AF substitution and clinker rate reduction’ – as opposed to ‘any technological breakthroughs’ like carbon capture. There are currently no public details of possible back-up financing arrangements for these projects; for now, the best guess at their status is ‘uncertain.’

Alongside these group’s local subsidiaries, another organisation that has to do business daily with the DoE is the American Cement Association (ACA). President and CEO Mike Ireland has continually acknowledged the complex needs of the government, while stating the association’s case for keeping support in place. With regard to these funding cuts, Ireland’s emphasis fell on the latter side: “Today’s announcement is candidly a missed opportunity for both America’s cement manufacturers and this administration, as CCS projects have long been supported by bipartisan members in Congress and bipartisan administrations.”⁶ He reasserted the ACA’s understanding that carbon capture aligns with the administration’s strategy to bolster domestic manufacturing and innovation.

The early 2020s heyday of US carbon capture was founded on gradual, consensus-based politics – unlike its demise. Table 1 (below) gives a non-exhaustive account of recent and on-going front-end engineering design (FEED) studies and the funding they received:

Additionally, MTR Carbon Capture, which is executing a carbon capture pilot at St Marys Cement’s Charlevoix plant in Michigan, previously received US$1.5m in Fossil Energy Research and Development funding towards a total US$3.7m for an unspecified cement plant carbon capture study.¹⁰

Market researcher Greenlight Insights valued industrial decarbonisation initiatives under the Office of Clean Energy Demonstrations (ODEC – the now defunct DoE office responsible, among other things, for the IDP) at US$65.9bn in cumulative returns in April 2025.¹¹ The government has yet to publish any account of how it might replace this growth, or the 291,000 anticipated new jobs that would have come with it. Given all this (along with the extensive financial and technical submissions that accompanied each project), the issues raised by the DoE are presumably budgetary, or else founded in a perception of CCUS as essentially uneconomical.

Carbon capture is very, very expensive. A fatuous reply is that so is climate change, just with a few more ‘verys.’ Hurricane Ian in September 2022 cost US$120bn, more than enough to fund carbon capture installations at all 91 US cement plants, along the lines of the former Lebac and Mitchell agreements.¹² Unlike climate change, however, carbon capture remains unproven. Advocates need to continually justify taxpayer involvement in such a high-risk venture.

At its Redding cement plant in California, Lehigh Hanson successfully delivered a funding-free FEED study, with its partner Fortera raising US$85m in a Series C funding. This presents an alternative vision of innovation as fully-privatised, in which the government might still have the role of shaping demand. This is borne out in the IMPACT Act, a bill which ‘sailed through’ the lower legislature in March 2025.¹³ If enacted, it will empower state and municipal transport departments to pledge to buy future outputs of nascent reduced-CO₂ cements and concretes.

A separate aspect of the funding cancellation that appears decidedly cruel is the targeted removal of grants to start-ups. Two alternative building materials developers – Brimstone and Sublime Systems – were listed for a combined US$276m of now vapourised liquidity. Both are commercially viable without the funding, but the effect of this reversal – including on the next generation of US innovators who hoped to follow in their footsteps – can only be chilling. As non-governmental organisation Industrious Labs said of the anticipated closure of the ODEC in April 2025: “We may see companies based in other geographies start to pull ahead.”

Heidelberg Materials’s Brevik carbon capture plant came online in June 2025, 54 months after the producer secured approval for the project. The term of a presidency is 48 months. This probably means that producers in the US will no longer see CCUS as a viable investment, even under sympathetic administrations.

Even as government funding for CCS flickers from ‘dormant’ to ‘extinct,’ the sun is rising on other US projects. Monarch Cement Company commissioned a 20MW solar power plant at its Humboldt cement plant in Kansas on 27 May 2025. The global momentum is behind decarbonisation, even if economics determines that it will only take the form of smaller-scale mitigation measures at US cement plants into the medium-term future. We can hope that these, at least, might include the AF and LC3 aspects of National Cement Company’s plans at Lebec.

References

1. Clean Air Task Force, ‘Global Carbon Capture Activity and Project Map,’ accessed 3 June 2025, www.catf.us/ccsmapglobal/

2. Democrats Appropriations, ‘Issue 5: Freezing the Industrial Demonstrations Program Undermines U.S. Manufacturing Competitiveness and Strands Private Investment,’ January 2025, www.democrats-appropriations.house.gov/sites/evo-subsites/democrats-appropriations.house.gov/files/evo-media-document/5%20DOE%20Frozen%20Funding%20-%20Industrial%20Demos.pdf

3. Colorado Attorney General, ‘Attorney General Phil Weiser secures court order blocking Trump administration’s illegal federal funding freeze,’ 6 March 2025, www.coag.gov/press-releases/weiser-court-order-trump-federal-funding-freeze-3-6-25/

4. US Department of Energy, ‘Secretary Wright Announces Termination of 24 Projects, Generating Over $3 Billion in Taxpayer Savings,’ 30 May 2025, www.energy.gov/articles/secretary-wright-announces-termination-24-projects-generating-over-3-billion-taxpayer

5. Vicat, ‘Cancellation of funding agreement for the Lebec Net Zero project by the US Department of Energy,’ 3 June 2025, www.vicat.com/news/cancellation-funding-agreement-lebec-net-zero-project-us-department-energy

6. American Cement Association, ‘Statement from the American Cement Association on Department of Energy’s Cancellation of Clean Energy Grants,’ 30 May 2025, www.cement.org/2025/05/30/statement-from-the-american-cement-association-on-department-of-energys-cancellation-of-clean-energy-grants/

7. Gov Tribe, ‘Cooperative Agreement DEFE0031942,’ 30 September 2022, www.govtribe.com/award/federal-grant-award/cooperative-agreement-defe0031942

8. Higher Gov, ‘DECD0000010 Cooperative Agreement,’ 13 May 2024, www.highergov.com/grant/DECD0000010/

9. Gov Tribe, ‘Cooperative Agreement DEFE0032222,’ 7 February 2025, www.govtribe.com/award/federal-grant-award/cooperative-agreement-defe0032222

10. Higher Gov, ‘DEFE0031949 Cooperative Agreement,’ 1 May 2023, www.highergov.com/grant/DEFE0031949/

11. Center for Climate and Energy Solutions, ‘Jobs, Economic Impact of OCED Closure,’ 11 April 2025, www.c2es.org/press-release/oced-closure-could-cost-65-billion-290000-jobs/

12. National Centers for Environmental Information, ‘Events,’ accessed 4 June 2025, www.ncei.noaa.gov/access/billions/events/US/2022?disasters%5B%5D=tropical-cyclone

13. US Congress, ‘H.R.1534 - IMPACT Act,’ 26 March 2025, www.congress.gov/bill/119th-congress/house-bill/1534

US: Heidelberg Materials North America is upgrading its Cementon cement distribution terminal in New York. The producer will build a new packaging line with a 200t/hr Haver & Boecker rotary packing machine and a fully-automated Beumer palletising system. It will also expand its cement storage silos in order to support the growth of its bulk cement sales.

Demand for heavy building materials in the UK dropped in the first quarter of 2025, with ready-mix concrete sales reaching a new 60-year low.¹ In an update last week, the UK’s Mineral Products Association (MPA) attributed the decline to existing economic headwinds, compounded by global trade disruptions, reduced investor confidence and renewed inflationary pressures.

Major infrastructure projects – including the HS2 high-speed railway in the English Midlands, the Hinkley Point C nuclear power plant in Somerset and the Sizewell C nuclear power plant in Suffolk – failed to offset delays and cancellations by cash-strapped local councils to roadwork projects. Residential construction, meanwhile, is ‘slowly but steadily’ recovering from historical lows, amid continuing high mortgage rates since late 2024.

The most interesting part of the MPA’s market appraisal was its warning of ‘new risks emerging in the global economy.’ These concern the new tariffs raised by the US against its import partners. The possible consequences, the MPA says, imperil the UK’s supply chains, construction sector and growth.

Of particular immediacy is the threat of imports into the UK from countries that previously focussed on the US market. The MPA said that the industry ‘cannot compete’ against increased low-cost, CO₂-intensive imports. It named Türkiye, which sends around 6.9Mt/yr of cement and clinker to the US, as a key threat. Türkiye became subject to the blanket 10% ‘baseline’ tariff on 2 April 2025.

The MPA probably didn’t have a particular company in mind when it said this. However, it bears noting that Turkish interests gained a share of UK cement capacity in October 2024, when Çimsa acquired 95% of Northern Ireland-based Mannok. Besides the Derrylin cement plant (situated on the border between Fermanagh, UK, and Cavan, Ireland), Mannok operates the Rochester cement storage and distribution facility in Kent, 50km from London. The facility currently supplies cement from Derrylin to Southern England and the Midlands. It could easily serve as a base of operations for processing and distributing imported cement and clinker from further afield.

Meanwhile in South West England, Portugal-based Cimpor is building a €20 – 25m cement import terminal in the Port of Bristol. The company is subject to 20% tariffs on shipments to the US from its home country. Its parent company, Taiwan Cement Corporation, is subject to 32% US tariffs from Taiwan.

But the plot thickens… On 8 May 2025, the UK became the first country to conclude a trade agreement with the US after the erection of the new tariff regime, under which the US$73bn/yr-worth of British goods sold in the US became subject to a 10% tariff.² The latest agreement brought partial relief for an allied sector of UK cement: steel. 180,000t flowed into the US from the UK in 2024.³ In 2024, the UK exported 7120t of cement and clinker to the US, up by a factor of 10 decade-on-decade from just 714t in 2014, all of it into two US customs districts, Philadelphia and New York City.⁴

In what may be one of the first true ‘Brexit benefits,’ UK cement exporters now ‘enjoy’ a US tariff rate half that of their EU competitors, notably those in Greece. Like the UK’s more modest volumes, Greece’s 1.82Mt/yr-worth of cement and clinker exports stateside also enter via the US’ eastern seaports, at New York City, Tampa and Norfolk. Given the overlaps in ownership between the Greek and UK cement sectors, it is conceivable that optimisation of cement export flows across Europe may already be under discussion.

On 6 May 2025, the UK and Indian governments announced a trade deal that will lift customs duties on almost all current Indian exports to the UK. UK MPs are still seeking clarifications as to whether this will include industrial products that might be dumped.⁵ Theoretically, the threat from an oversupplied and fast-growing cement industry like India’s could be existential to the UK cement industry.

As the UK invests heavily in its future, including with the HyNet Consortium, imports pose a major threat. Given enough time, the UK could develop a leading position in the decarbonisation space. Will it have enough time? Existential threats certainly add a sense of jeopardy.

References
1. Mineral Products Association, ‘Weak start to 2025 for building materials sales amid growing economic headwinds,’ 6 May 2025, www.mineralproducts.org/News/2025/release16.aspx

2. HM Government, ‘UK overseas trade in goods statistics November 2024,’ 16 January 2025, www.gov.uk/government/statistics/uk-overseas-trade-in-goods-statistics-november-2024/uk-overseas-trade-in-goods-statistics-november-2024-commentary

3. UK Steel, ‘US 25% tariffs on UK steel imports come into effect,’ 12 March 2025, www.uksteel.org/steel-news-2025/us-25-tariffs-on-uk-steel-imports-come-into-effect

4. United States Geological Survey, ‘Cement in December 2024,’ January 2025, https://d9-wret.s3.us-west-2.amazonaws.com/assets/palladium/production/s3fs-public/media/files/mis-202412-cemen.pdf

5. Welsh Liberal Democrats, ‘UK-Indian Trade Deal: Government Refuses to Answer Whether it Has Conceded on Cheap Indian Steel Imports,’ 6 May 2025, www.libdems.wales/news/article/uk-indian-trade-deal-government-refuses-to-answer-whether-it-has-conceded-on-cheap-indian-steel-imports

US: The US Department of Energy may end the Industrial Demonstrations Program that aims to decarbonise hard-to-abate industries like cement, placing up to US$6bn in federal grants at risk, according to Canary Media. This includes an eventual US$500m in Heidelberg Materials North America’s Mitchell cement plant carbon capture project in Indiana. The project is reportedly at risk after 'significant' staff cuts at the Department of Energy.

The senior vice president of sustainability and public affairs for Heidelberg Materials North America, David Perkins, said that the company was ‘uncertain’ and that ‘coordination and communications [had] changed’. He added that the company is still submitting reports for the grant to the Department of Energy and exploring alternative funding sources.

US: Heidelberg Materials North America announced that it has completed the acquisition of Giant Cement Holding (GCHI) and its subsidiaries Giant Cement Company, Dragon Products Company and Giant Resource Recovery from the Fortaleza, Uniland and Trituradora groups.

The deal includes a cement plant in Harleyville, South Carolina, four associated distribution terminals, and cement and slag distribution terminals in Newington, New Hampshire and Thomaston, Maine. It also includes Giant Resource Recovery, an alternative fuel recycling business in the eastern US.

President and CEO Chris Ward said “We are pleased to complete the acquisition of the GCHI assets and further strengthen our presence in the important Southeastern US and New England markets. We welcome the approximately 400 employees and the GCHI customers to Heidelberg Materials and look forward to the opportunities ahead.”

Canada: Heidelberg Materials North America has secured government support from Innovation, Science and Economic Development Canada (ISED) for its carbon capture, utilisation and storage (CCUS) project at its Edmonton cement plant in Alberta. The project aims to capture over 1Mt/yr of CO₂.

In 2023, the Minister of Innovation, Science and Industry signed a letter of intent to contribute US$191m to the project, with US$34m already allocated for phase one. The remaining US$157m will be finalised through a phase two agreement to support the construction of the CCUS system and a combined heat and power (CHP) facility. The funding has been earmarked under the Strategic Innovation Fund (SIF) and is contingent on Heidelberg Materials making its final investment decision.

“This groundbreaking partnership with Heidelberg Materials takes us one step closer to a net-zero Canada by 2050,” Minister of Innovation, Science and Industry François-Philippe Champagne said. “By building North America’s first carbon capture system in cement, we’re driving innovation, cutting emissions and securing a sustainable future.”

US: Heidelberg Materials North America has begun test well drilling at its Mitchell cement plant in Indiana as part of the CarbonSAFE carbon capture and storage (CCS) project led by the Illinois State Geological Survey (ISGS).

The drilling started on 22 January 2025 to assess the geology beneath the plant, which is located in the Illinois Basin, for CO₂ storage potential. The test will evaluate three carbon storage formations to a depth of 2210m to determine if the site can safely store 50Mt of CO₂ over 30 years.

The project began in early 2023 with seismic data collection across 87km of roadways, leading to the installation of the geologic test well.

Greg Ronczka, vice president of Carbon Transport & Storage Development said "This is an exciting step for the project as we learn which potential formations may be suitable to permanently and safely store the CO₂. This knowledge will help us design the injection and observation well network and allow us to prepare a complete and accurate US Environmental Protection Agency Class VI permit application."

US: Heidelberg Materials North America has signed a binding agreement with Giant Cement’s multiple minority shareholders to acquire the producer outright. Noticias Financieras News has reported that Heidelberg Materials North America will pay approximately US$600m for the business. Giant Cement is scheduled to fully shut its Thomaston, Maine, cement plant in early 2025.

Giant Cement belongs to Spain-based Cementos Portland Valderrivas, with a 45% stake, Mexico-based Cementos Fortaleza (41%) and Mexico-based Trituradora y Procesadora de Materiales Santa Anita (14%).

US: Heidelberg Materials North America has entered into a definitive purchase agreement to acquire Giant Cement Holding, a cement producer on the US East Coast focused on using refuse-derived fuels, for US$600m. The acquisition will reportedly strengthen Heidelberg Materials’ cementitious footprint in the Southeastern US and New England markets and help to contribute to its circular offerings and decarbonisation efforts.

The transaction’s assets in the Southeastern US include an integrated cement plant with a capacity of 800,000t/yr in Harleyville, South Carolina, a network of four cement terminals in Georgia and South Carolina, and a joint venture deep-water import terminal in Savannah, Georgia. Assets in the New England area comprise a cement and slag terminal in Newington, New Hampshire, and a deep-water import terminal in Boston, Massachusetts. The transaction also includes Giant Resource Recovery, an alternative fuel recycling business with four facilities in the Eastern US. The transaction is expected to be completed in the first quarter of 2025 and to contribute around US$60m in earnings by interest, taxation, depreciation and amortisation in the first year of operation.

US: Heidelberg Materials North America has finalised award negotiations with the US Department of Energy's (DOE) Office of Clean Energy Demonstrations. The Mitchell cement plant in Indiana will receive US$300,000 to begin the first phase of its decarbonisation project, part of a broader initiative of up to US$500m in DOE funding to support full-scale carbon capture, transport and storage developments. The Mitchell cement plant has tripled its previous production capacity, with this project aiming to capture and process about 2Mt/yr of CO₂.

Chris Ward, president and CEO of Heidelberg Materials North America, said "This critical milestone of bringing our project under award with the US Department of Energy is a significant step in building the first full-scale application of carbon capture and storage for the cement industry in the US.”