Chinese firm, Sinoma International Engineering Company and Bua Group, have commenced discussions on construction of a steel plant in Nigeria and two cement factories in East Africa.
New Telegraph gathered that the two firms are planning to partner to construct these plants to deepen their dominants and boost supply of building materials in Nigeria.
Confirming the plans for the steel plant in Nigeria, Bua’s Group Chairman, Abdulsamad Rabiu, disclosed that the project would cost $1.9 billion. Sinoma International possesses the core technology and a complete innovation system in the non-metallic material industry.
Last year, the company signed a $4.34 billion deal with the Dangote Group to build various cement plants across Africa. Bua’s Group Chairman said that the steel plant with 1.2 million tonnes capacity would cost $1.2 billion, while the two cement plants with an annual capacity of three million tonnes would cost $700 million.
He noted that last year, the group signed a contract worth $600 million with Sinoma International to double its cement production capacity and expand its market share in Nigeria.
However, CEO of Dangote Cement, Mr Van der Weijde, during the Cemtech’s 25th anniversary celebrations recently in Dubai, stated that Dangote was on track to deliver 76.5 million metric tonnes per year of cement capacity in 14 countries by 2020, representing 24 per cent of Africa’s cement capacity, up from 18 per cent in 2015.
The company had announced its plans to construct new cement plants in Nigeria, particularly in Okpella, in the northern part of Edo State and Itori in Ogun State.
The new plants are expected to add nine million tonnes a year to the company’s current output of 29.25 million tonnes a year, raising it to a total 38.25 million tonnes a year.
The Itori plant is expected to deliver six million tonnes a year from two production lines. Both plants are expected to come on stream between 2018 and 2019.
The expansion drive is targeted to expand the nationwide presence and reducing the transportation cost component of its operations. He added that the new investments would also lower the cost of production, bring about a future reduction in the price of cement and generate employment opportunities in the host communities.
Dangote Cement is capable of supplying the entire western and central Africa region. The cement company currently exports its cement to Togo, Niger and Ghana with plans to also move into Ivory Coast.