Top cement producers in the country are aggressively funding new projects in a bid to raise their installed production capacity by an additional 22.5 million metric tons (mmt) per annum.
Vanguard’s investigation revealed that the expansion, by Dangote Cement Plc, Lafarge Africa Plc and BUA Group, will bring their aggregate total capacity to 53.75 million metric tons by the end of 2018, from the current 31.25 million metric tons per annum. Investigation further revealed that expansion is aimed at increasing market share in the local market as well as to enhance their export capabilities.
Data on local production capacity of the three cement producers, the installed capacity of the cement producers rose from 11.9 million metric tons in 2008 to 31.25 million metric tons in 2016, courtesy of the backward integration policy of the federal government. Analysis of the new projects showed that of Dangote Cement plans to increase its capacity by 12 million metric tons by the end 2018.
The company is constructing $1 billion cement factory in Okpella, Edo State, to expand its cement production in Nigeria which currently stands at 20.25 million metric tons.
Cement The Okpella project is designed to contribute six (6) million metric tons per annum while the company’s plant in Itori, Ogun state will also contribute six (6) million metric, thus increasing the company’s local production capacity to 32.25 million metric tons per annum. Lafarge also plans to increase its production capacity by five (5) million metric tons to its existing production capacity of 8.4 million metric tons in Nigeria.
Already the company has injected N80 billion to raise the production capacity of Ashaka Cement in Gombe, to 2.5 million metric tons from 1 million metric tons, in line with potentials in the market.
The company is also expanding its WAPCO production capacity by 2.5mmt production. BUA Group also plans to add 7.5 million metric tons to its current production capacity of 4 million metric tons.
This will raise its total capacity to 11.5 million metric tons in 2018.
The company is expanding its wholly owned green-field Obu cement factory, Okpella, Edo state, by an additional 3.5 million metric tons.
The company is also expecting 1.5 million metric tons from its cement subsidiaries- Cement Company of Northern Nigeria, CCNN, and Edo Cement 3 million metric tons per annum. The CCNN new line is expected to be completed before the end of the third quarter of 2017.