Displaying items by tag: Plant

Nigeria: Dangote Cement sales volumes in the first quarter of 2022 have been hampered by disruptions to gas supplies domestically and by high freight rates restricting its exports of cement and clinker to Cameroon, Ghana and Sierra Leone. Its sales volumes of cement fell by 3.6% year-on-year to 7.25Mt in the first quarter of 2022 from 7.52Mt in the same period in 2021. Its revenue grew by 24% to US$994m from US$801m. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) increased by 18.6% to US$508m from US$428m.

Michael Pucheros, the chief executive officer of Dangote Cement, said “Our group volumes were down 3.6% mainly due to energy supply challenges in Nigeria. Our operations relying on cement and clinker imports – namely Ghana, Sierra-Leone, Cameroon - were impacted by the global supply chain challenges.” Additionally, its operations outside of Nigeria was also negatively affected by a cement plant in Congo being shut for over two months due to maintenance and repairs and extended power plant maintenance in Senegal.

US: Argos USA has launched its new Portland Limestone Cement (PLC) brand EcoStrong.The company says the its will complete its conversion to 100% EcoStrong PLC cement production across all facilities in 2023.Its Roberta, Alabama cement plant and Atlanta, Georgia grinding plant will transition by mid-2022, while its Newberry, Florida cement plant will transition by October 2022.Argos USA plans to use EcoStrong cement at all of its Eastern US ready-mix concretesites by mid-2022.

Cement technical director Steve Wilcox said“I am excited to be part of Argos’ brand announcement for our PLC Type IL product. EcoStrong PLC encompasses everything we have worked for over the past decade, to offer a high-quality product with lower embodied carbon, which contributes to the ultimate goal of decarbonising across our operations. Our PLC product is engineered to reduce the harmful effects on the environment and perform similar to or better than our ordinaryPortland cement (OPC) Type I/II. EcoStrong PLC empowers our customers, specifiers, architects, and engineers to design and execute their projects with resilience and sustainability.”

Canada: The Government of Quebec says it will allocate up to US$36m towards a US$110m upgrade project at Ciment Québec’s integrated St Basile plant. The plant intends to build a new grinding unit including new reception, storage and raw material handling systems and two mills. The work is intended to reduce the CO₂ emissions from the plant. France-based Fives FCB previously said that it had won a contract for the project. Commissioning of the new equipment is scheduled for the beginning of 2024.

Dominican Republic: Colacem Group subsidiary Domicem has awarded the contract to upgrade the limestone reclaiming system at its integrated Sabana Grande de Palenque cement plant in San Cristóbal province to Italy-based Bedeschi. The original stacking and reclaiming equipment, installed by Bedeschi in 2004, allows clay and limestone handling at the plant. The upgraded machine will improve the limestone reclaiming system, increasing its capacity from 200t/hr to 360t/hr, the capacity needed in order to feed a new production line that is being installed at the plant.

India: Dalmia Cement (Bharat) has signed a memorandum of understanding (MOU) with Denmark-based FLSmidth to collaborate in the research and development of sustainable solutions for cement manufacturing. The agreement has been arranged under the ‘Green Strategic Partnership’ initiatives between Denmark and India that cover energy and climate change.

Under the MOU both companies will cooperate on a range of areas such as substituting conventional energy supplies with renewable sources and working towards CO₂ emissions abatement. Both companies have committed to contributing research and development towards eventually building an industrial scale production plant where the new concepts can be further tested.

Mahendra Singhi, the managing director and chief executive officer of Dalmia Cement (Bharat) said, “In alignment with the ambitious net zero vision of our Prime Minister Narendra Modiji and given the strength and stature of our respective organisations, this association will provide futuristic solutions to the cement and concrete industry to emerge clean and green.” He added that India and Dalmia Cement in particular were keen to develop a roadmap for the implementation of Industry 4.0 with totally decarbonised cement plants and a ‘lighthouse’ cement plant.

Zimbabwe: South Africa-based PPC has held a groundbreaking ceremony for a US$40m project to build solar power plants with a joint output of 30MW to support its integrated Bulawayo and Colleen Bawn cement plants. The Bulawayo plant will set up a 10MW plant, with 5MW earmarked for internal use, while the Colleen Bawn plant will develop a 20MW capacity, 12MW being used internally, according to the Chronicle newspaper. The excess electricity will be fed in the national grid. PPC has chosen ATC Consortium to build and operate the solar plants under a 20-year power purchase agreement.

Dominican Republic: Mexico-based Cemex has reopened the second production line at its integrated San Pedro Macoris plant. The decision will add 0.5Mt/yr to the plant’s production capacity bringing its total to 2.5Mt/yr. The decision has been made to support customers in the Caribbean market. Other recent investment in the country by Cemex include new packaging machines, palletisers, hydro combustion, new trucks and tanks.

Jesús González, the president of Cemex South, Central America and the Caribbean said “The reactivation of the production line is a clear example of our commitment to the sustainable development of the Dominican Republic. This investment contributes to the revitalisation of the national economy, promotes exports, reduces the need for imports and supports employment and a more sustainable environment in the country."

Russia: Eurocement has started an initiative to reduce its reliance on spare parts purchased from outside of the country. The programme is designed to start a phased transition to in-house production of components. One of the first examples of the scheme has been the development and installation of a clutch for a mill at the Sengileevsky cement plant.

The cement producer hopes to source at least 90% of the parts it requires domestically. At present it says that around 30% of the equipment used in the local cement sector is imported. The estimated economic effect will be around Euro14m.

The company has also announced an unscheduled indexation of staff wages to over 7000 workers at 16 cement plants. Indexing of wages is typically used to compensate for inflation. Other measures have also included food support. Vyacheslav Shmatov, the general director of Eurocement, said ““We have decided to increase our support measures for our employees during this difficult time in order to strengthen our work teams. Eurocement is, first of all, people, so the company will continue to take care of its employees.”

International economic sanctions were implemented upon Russia by European and North American countries in response to its invasion of Ukraine in February 2022.

This week’s big story has been that Holcim may be considering selling its business in India. Both the Economic Times newspaper and Bloomberg separately reported that the owner of Ambuja Cement and ACC has been holding early talks with local producers. The discussions have been described as exploratory and an eventual divestment is far from certain. The combined market value of both companies was placed at US$15bn, at the time that the story broke, making it one of the largest potential acquisitions in India. Holcim has refused to comment on the matter.

If it actually happened then the scale of this potential sale would be breathtaking. Holcim has been gradually slimming down since the merger between Lafarge and Holcim in 2015. The big divestments mostly came after the appointment of former Sika boss Jan Jenisch in 2017. Four integrated plants and other assets were sold in Indonesia for US$1.75bn in 2019, a 51% stake in three integrated plants and two grinding plants were sold in Malaysia for US$396m (also in 2019) and five integrated plants were approved for sale in Brazil for US$1.03bn in April 2022.

A complete divestment of Ambuja Cement and ACC in India would see 17 integrated plants and 14 grinding plants being sold with a production capacity of around 66Mt/yr. If any company did buy the lot in one go, at a stroke it would become the second-largest cement producer in the world’s second-largest second market. The nearest acquisition in the last decade that comes close to this was when CRH purchased 24 cement plants with a production capacity of 36Mt/yr from Lafarge and Holcim in 2015 for US$6.5bn.

2022 would certainly be a good time to sell up with both Ambuja Cement and ACC having reported strong sales and earnings figures in 2021 following the coronavirus-related lockdowns in 2020. Performance is even better compared to 2019. Ambuja Cement’s net sales and earnings before taxation, interest, depreciation and amortisation (EBTIDA) grew by 23% year-on-year to US$1.81bn and by 21% to US$420m respectively in 2021. ACC’s sales and operating EBITDA grew by 17% to US$2.07bn and 28% to US$393m respectively in 2021. However, ACC’s net sales growth was much lower compared to that in 2019. Ambuja Cement produced 25.9Mt of cement in 2021 with a production capacity of 31.5Mt giving it a utilisation rate of 82%. ACC produced 26.9Mt of cement in 2021 with a production of 34.5Mt/yr giving it a utilisation rate of 78%. Both of these rates are higher than the national cement sector rates forecast by analysts of up to 64% in the 2022 financial year. The corporate specifics of any sale are that Holcim owns a majority stake in Ambuja Cement, which in turn owns a majority stake in ACC. In other words: buy one, get the other.

One wider question here is whether there are still any companies and investors out there prepared to put money on this scale into a carbon-intensive industry with net-zero deadlines on the way. Ahead of the 2021 United Nations Climate Change Conference (COP26) in November 2021, India’s prime minister Narendra Modi pledged that his country would cut its emissions to net-zero by 2070. There’s plenty of time left to turn a profit, as cement kilns last about 50 years, but the risk of investing in a stranded asset is growing if the targets are honoured or even brought forward. As a recent Intergovernmental Panel on Climate Change (IPCC) report put it, “Cement and concrete are currently overused because they are inexpensive, durable, and ubiquitous, and consumption decisions typically do not give weight to their production emissions.” All of this suggests that buyers might well be more interested in purchasing parts of Holcim’s Indian operations rather than the whole bundle or breaking operations up further down the line. And that’s even before any competition concerns related to any local buyers are considered. Holcim, for its part, has shown with recent divestments, such as its business in Northern Ireland, that it isn’t necessarily against smaller piecemeal divestments. Negotiations, if they are indeed happening, will be closely guarded.

India: ACC’s earnings before taxation, interest, depreciation and amortisation (EBTIDA) fell by 26% year-on-year to US$83.1m in the first quarter of 2022 from US$113m in the same period in 2021. Net sales rose by 3% to US$566m from US$552m. Sales volumes of cement dropped by 3% to 7.71Mt but volumes of ready-mixed concrete grew by 5% to 0.87Mm³. The subsidiary of Ambuja Cement and Holcim said that its costs had been negatively affected by a global rise in fuel costs caused by ‘geopolitical events.’

The cement producer said that its new integrated plant at Ametha in Madhya Pradesh is scheduled to be commissioned in the fourth quarter of 2022. It commissioned an upgrade to its Tikaria grinding plant in Uttar Pradesh in February 2022. Waste heat recovery unit projects at its Jamul and Kymore plants are ‘on track’ and the board of ACC has approved the next phase of similar projects at its Chanda and Wadi plants.