Lai Mohammed, the Minister of Information and Culture, indicated Wednesday that when the Kano-Jibia Maradi railway line is completed, it will assist to lower cement prices in the country.
According to him, the railway line will assist cement makers save money on transportation and energy because the majority of Liquefied Natural Gas (LNG) will be transported by train.
According to one of the producers, the current open market price of N4000 for cement is around 25% to 30% higher than the ex-factory price.
During a tour of BUA’s Kalambaina cement mill in Sokoto State, he said this.
“By the time that segment of the train is completed, transporting cement from Sokoto to all parts of Nigeria by rail will be cheaper,” he says. It will also help to lower the cost of energy used in cement production by transporting bulk LNG to the facility. We are convinced that, if the logistical issues are resolved, we will see a significant reduction in the cost of cement in a few years.”
Meanwhile, Yusuf Binji, the Managing Director and Chief Executive Officer of BUA Cement Plc, noted that cement producers are still underproducing, citing a demand of 30 million tonnes, which is considerably below Ghana, Egypt, Senegal, and the Ivory Coast in terms of per capita consumption.
“Instead of 30 million tonnes, we should be doing 70 million tonnes.” When compared to Ghana, Nigeria still has a low per capita cement usage. “Our per capita consumption is roughly 123kg, or less than two and a half pounds, whereas Ghana’s per capita consumption is about five pounds,” he said.
The Minister, on the other hand, stated that the fact that BUA was granted pioneer status, the ban on cement importation, the government’s divestment from the cement industry, and the backward integration policy have all contributed to BUA cement’s success, particularly since 2015, when the current administration took office.
“As a result of these conditions, BUA Cement’s production increased by 300 percent between 2015 and currently.” This represents an increase from 3.5 million tonnes per year in 2015 to 11 million tonnes per year presently. “The Sokoto facility, for its part, is working at over 90% of its installed capacity,” he stated.
“Because of its position, which is only 100 kilometers from the Niger Republic, the facility exports to Niger and Burkina Faso, providing Nigeria with much-needed foreign currency,” he continued. Please keep in mind that, especially during the rainy season, only surplus is exported. Other details include the fact that the business operates all year and loads between 250 and 270 trailers per day. For cement delivery, the factory has 700 vehicles.”
He pointed out that the BUA Cement facility’s three million tonnes per annum line (IV) brings the factory’s total installed capacity of lines 2, 3, and 4 to 5 million tonnes per annum, emphasizing that this is one of the world’s most advanced cement plants.
“It has gas analyzers for regulating carbon emissions into the atmosphere, as well as air purification technologies to improve the quality of air emitted throughout the cement making process.” In fact, the plant features filters that can capture 99.9% of dust, ensuring a healthy and favorable atmosphere for both workers and customers,” he noted.
He claimed that the factory is Nigeria’s first cement plant to use LNG to create 50MW of power, effectively substituting coal in the kiln, and that this has made the plant ecologically benign, in keeping with the country’s climate change goal.
“I am confident that once the AKK gas pipeline project is done, it will significantly cut the time and cost of transferring gas from Port Harcourt to the facility.” Every day, at least 20 LNG trucks arrive from Port Harcourt. Consider the financial and logistical obstacles that this would entail.
“Of course, this facility also creates jobs.” As the Managing Director stated, there are 443 permanent employees, and the total number of positions, including all ancillary jobs, is around 10,000,” he stated.
He praised Alhaji Abdul Samad Rabiu, Chairman of BUA Cement, and his entire team for their unwavering faith in Nigeria, noting that the company’s huge investments in the country are the best indicator of BUA’s support for the government’s economic diversification and job creation program.
“BUA has constructed four additional cement facilities of similar size in different parts of the country in the last five years, and is on track to finish two more plants soon.” BUA Cement’s overall production is expected to reach 17 million tonnes per year by 2023,” he added.
Binji previously stated that its strategic priorities for future investment would be to drive revenue and cost synergies across revenue and margin lines, harmonise sale and marketing strategy across its two plants, expand customer portfolio and capture new market areas such as export, construct lines 3&5 at the Obu and Sokoto plants, and deploy solutions that improve customer experience.