Displaying items by tag: Plant

Sweden: Germany-based HeidelbergCement subsidiary Cementa plans to upgrade its Slite unit in Gotland to become the world’s first carbon-neutral cement plant. This will be achieved through modification of the plant’s fuel system to ‘significantly raise’ biobased fuel substitution, as well as 100% carbon capture and storage (CCS) via a 1.8Mt/yr CCS installation. Full-scale capturing of the plant’s CO₂ emissions is scheduled by 2030.

Chair Dominik von Achten said, “HeidelbergCement will be the leader in the global cement industry on its transformation path towards climate neutrality. The key for decarbonising our industry is to find, apply and scale technical solutions for carbon capture and utilisation or storage (CCU/S). After having gained valuable experience with CCU/S technologies in Norway and other countries, we are now excited to make the next step with a completely carbon-neutral cement plant in Sweden.”

Iran: Abyek Cement Complex has relaunched a 8500t/day production line at its plant in Abyek, Qazvin province following repairs. Alireza Razm Hosseini, head of the Ministry of Industry, Mine and Trade, attended the event. The production line is the largest in the country, according to the ministry. Cement produced at the plant will be exported.

The Tehran Times newspaper has reported that the relaunch brings the total national capacity to 80Mt/yr across 74 plants. Domestic demand was 70Mt in the 2021 financial year, which ended on 21 March 2021.

Pakistan: Bestway Cement has provided details of its upcoming 7200t/day-capacity Paikhel cement plant in Mianwali district, Punjab province. China-based Sinoma International Engineering Company will supply engineering, procurement and construction for the plant. The plant will have a 9MW waste heat recovery (WHR) plant.

Pakistan: Descon Engineering says it has been awarded the construction contract for Maple Leaf Cement’s new 7000t/day production line at its integrated Iskanderabad plant. Line 4 is scheduled to be commissioned in mid-2022. China-based Chengdu Design & Research Institute of Building Materials Industry was awarded the equipment and engineering contact for the project in April 2021. Descon Engineering previously contributed towards the work on Line 3 at the unit in conjunction with Denmark-based FLSmidth in 2019. No value for the order has been disclosed.

Cuba: Cementos Cienfuegos’ Carlos Marx cement plant in Guabairo resumed production in late May 2021. Production had been suspended since 14 January 2021 due to a lack of petcoke, according to the Sierra Maestra newspaper. Fuel suppliers had been affected by a fuel shortage created by US trade sanctions. Despite the enforced shutdown the plant intends to meet its production target for 2021.

Spain: Turkey-based Çimsa Çimento intends to complete its acquisition of Cemex’s Buñol white cement plant in June 2021. Local government says that the purchase agreement has been in place since 2019 but has delayed by the international nature of the deal and competition concerns, according to Agencia EFE. Çimsa Çimento agreed to buy Cemex’s white cement business in Spain, including its Buñol plant, for around US$180m in March 2019. It was originally scheduled for completion in the second half of 2019.

Mozambique: Chinese West International Holding subsidiary Dugongo Cement has inaugurated its 2.0Mt/yr integrated Matutuine cement plant in Maputo province. The unit had an investment of US$330m, according to the Mozambique News Agency. The site includes a captive 36MW charcoal-fired power station and a residential complex for some of its 300 permanent staff.

President Filipe Nyusi said, “The Dugongo Cement plant will improve the economy of the cement industry, because it will reduce the import of inputs such as clinker."

Jordan: Lafarge Jordan has had its insolvency filing approved by a court in Jordan. The Jordan Times has reported that the company has capital of US$84.6m, while its accumulated losses are US$169m. It has blamed weak demand and an inability to cope with variable operating and administrative costs made worse by the coronavirus crisis.

The company said that it plans to continue its reform process so that it is able to meet its obligations under insolvency law. It added, “The company intends to adopt a well-thought-out and actionable financial plan to pay off its debts and meet its liabilities within reasonable legal periods and in agreement with creditors.”

The subsidiary of Switzerland-based LafargeHolcim owns two integrated cement plants in the country. However, its Fuheis plant has been mothballed since the early 2010s. Its Rashadiyah plant has two production lines but one has been unused for over a decade and the other is reportedly operating at 40% of its capacity.

HeidelbergCement confirmed the rumours this week with the announcement that it was selling assets in the western US to Martin Marietta for US$2.3bn. The deal covers subsidiary Lehigh Hanson’s US West region cement, aggregates, ready-mixed concrete and asphalt businesses in California, Arizona, Oregon and Nevada. This includes two of its cement plants, with the exception of the 1.5Mt/yr Permanente cement plant in California, related distribution terminals, 17 active aggregates sites and several downstream operations. The companies expect to conclude the deal by 2022 but naturally it is subject to approval by competition bodies.

Well, this is a big one considering that one of the catalysts for the group’s divestment plan was the reduction of the value of its total assets by Euro3.4bn in July 2020 following a review. Depending on the exchange rate, the value of the divestment to Martin Marietta covers half to two thirds of that amount. Group chairman Dominik von Achten later told the media in February 2021 that the company was planning to sell the first of the five assets in early-to-mid 2021. However, cement isn’t the full story here since Lehigh Hanson operates three integrated plants in California and seven terminals. So, by elimination, the Tehachapi and Redding plants are the ones that are being sold along with some combinations of the terminals. Both of those plant have production capacities of around 0.8Mt/yr. Unless the terminals being sold have been valued highly, then the majority of the deal appears to encompass some or all of the 25-odd aggregate sites, 15 asphalt sites and 30 ready-mix concrete sites the company operates in the four states.

On the cement side it doesn’t seem unreasonable at face value for the authorities to allow Martin Marietta to take over most of Lehigh Hanson’s business in the region since it should broaden competition from a production angle. Instead of five companies in California with integrated plants, there will be six. For Martin Marietta, the deal also carries the feel of unfinished business in the region since it briefly held a cement business there for around a year in the mid-2010s. It acquired Texas Industries (TXI) in July 2014 and then sold the cement business in California to CalPortland in September 2015.

Both companies are pursuing different strategies. HeidelbergCement says it is hunkering down on its other four North American regions – the US Midwest, Northeast and South, plus Canada - through selected ‘bolt-on’ acquisitions and plant upgrades. Martin Marietta says it wants to take advantage of long term demand trends such as increased state infrastructure investment in California and Arizona and private-sector growth. It also reassured shareholders with its version of the acquisition/divestment story by saying it was going to generate value the same way it did previously with TXI. It’s a small thing but the acquisition also sees the US’ largest domestic cement producer increase its production base. The top five North American cement producers will remain controlled by companies headquartered in Europe but it is a step towards regionalism.

As for who’s right, in the short term, the west coast region looks good. The area included some of the best performing states in 2020 in terms of growth in cement consumption year-on-year in 2020 with the exception of Oregon. In its winter forecast the Portland Cement Association (PCA) attributed growth in the Mountain region of the US (including Nevada) to underlying economic fundamentals and favourable demographic trends, although it expected this to slow down in 2021. In the Pacific region it forecast consumption to grow modestly in 2021 due to residential construction. As if to underline the current situation, Cemex decided to recommission a kiln in Mexico in February 2021 to cope with cement shortages and project delays in California, Arizona and Nevada.

In the face of these figures HeidelbergCement’s decision to sell suggests either it dangled a juicy proposition with good short term prospects in front of the buyers or its long term projections are pointing elsewhere. Selling up, yet holding onto its largest cement plant in the region, also smacks of hedging its bets. No doubt it will be holding on to a few terminals too. On the other hand, it would be very interesting indeed to know what part, if any, HeidelbergCement’s internal carbon price played in its decision to divest in the western US. California has the country’s biggest carbon emissions trading scheme (ETS). If say, legislators suddenly decided to follow the price trend of the European Union’s ETS then things might look different.

US: HeidelbergCement subsidiary Lehigh Hanson has agreed to sell its assets in its US West region to Martin Marietta for US$2.3bn. The transaction includes the sale of its business activities in cement, aggregates, ready-mixed concrete and asphalt in California, Arizona, Oregon and Nevada, with the exception of the Permanente cement plant and quarry. The sale includes two cement plants with related distribution terminals, 17 active aggregates sites and several downstream operations. The companies expect to conclude the deal by 2022 subject to regulatory approval.

“The sale of our US West region activities is a major step in our portfolio optimisation as part of our ‘Beyond 2020’ strategy,” said Dominik von Achten, chairman of the managing board of HeidelbergCement. “We are simplifying our portfolio in North America and prioritising on the strongest market positions.” Chris Ward, president and chief executive officer of Lehigh Hanson added, “We will accelerate the build-out of our positions in the four key regions Canada, Midwest, Northeast and South through selected bolt-on acquisitions and capacity expansion projects in the future.”