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Yemen Invests $125 Million in Upgrade of Bajil Cement Plant

Beirut (APD) - Sana'a-based Yemen Corporation for Cement Industry and Marketing , a state-owned company that runs the three cement plants in the country, awarded Chinese firm CIMAC a $125 million contract to upgrade Bajil Cement Plant, the Riyadh-based al Iqtisadiya daily reported Friday.

The Chinese company will start its work on the plant as soon as the agreement is officially signed by the Yemeni President Ali Abdullah Saleh during his visit to China in early April.

The project includes establishing a new line to increase the Bajil Plant's production capacity by 850,000 tons per year (tpy) to a total capacity of 1.2 million tpy by the end of 2007, plus a 30 megawatt power station for the plant.

The plant's existing production line with annual output of 250,000 tpy of white cement also will be modernized. The Bajil Cement Plant is located in western Yemen's Hudaydah governorate.

Mohammed Shanif, the deputy chairman of the Yemeni cement corporation, said that the expansion and modernization plan is in line with the government strategy for increasing national cement production capacities.

Yemen aims to avoid repeating the problem of cement shortages and black-market cement prices that last year exceeded official prices by 70 to 80%.

Yemen's three state-owned cement factories operating under the supervision of Yemen Corporation for Cement Industry and Marketing are Bajil, Al Barh and Amran. These factories have a combined production capacity of 1.8 million tpy which covers only 45% of local demand, making the country highly dependent on cement imports.

At the Amran Cement Plant, which is also undergoing an upgrade, expansion of production capacities to 1.2 million tpy at a cost of YR 30 billion ($162 million) is scheduled to be complete by mid 2006. The plant will reach a production capacity of two million tpy by 2010.

Moreover, the Yemeni government started at the beginning of this year to establish more cement plants with the help of international investors. Arab private sector investors also announced plans to build new cement factories in the country.

A Saudi investor, Hussein bin Abdel Rahman al Attas, said earlier this month that he wants to invest more than SR 2 billion ($533.3 million) in establishing a cement plant in the southern Yemeni region of Ahwar, the Al Riyadh daily reported on March 7.

Last September, the Arab-Yemeni Cement Company owned by Saudi and Yemeni investors and headquartered in Yemen, announced plans to establish a cement plant with a production capacity of 1.2 million tpy at a cost of $260 million in the Mukalla region of Yemen's Hadhramaut governorate. [TS]

By Nadim Issa, APD Staff Writer in Beirut

© APD (Arab Press Digest) 2006