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Jordan: Arabian Cement completes requirements to set up new factory in Qatraneh

AMMAN -- Arabian Cement , a Saudi Arabian-based company, has obtained all the licenses required to establish a $220 million new cement factory in Qatraneh where huge reserves of raw materials exist.

The project was announced at a Thursday press conference during which the chairperson of the parent company, Abdullah Issa, told reporters that the new plant, expected to go operational by the end of 2009, will mainly target local market with an eye on other neighbouring markets, including Iraq.

Construction works are scheduled to begin the second quarter of 2007.

According to Issa, the venture is feasible due to the growth in the Jordanian construction market. He estimated Qatraneh's deposits of limestone, the basic material for cement production, to last for 300 years at a daily production rate of 5,000 tonnes.

The chairperson admitted that investment in cement production is costly but "it is our responsibility towards shareholders to make sure that this investment pays off."

Issa, whose company controls a 12 per cent share of the Saudi market, said the project in Qatraneh, 90 kilometres south of Amman, includes plans to safeguard the environment and develop the local community.

It is estimated the plant needs 300 workers, with the investors expecting that it would be totally staffed by Jordanians.

In terms of fuel, the company's top priority is to use Egyptian natural gas, which passes though Qatraneh via a regional pipeline that is expected to reach Turkey and Europe. The controversial, environment-unfriendly petcoke is a possibility, officials from the company said, but it remains as the last and least probable option.

"The plant is already designed to use natural gas and fuel oil," a top executive remarked.

Responding to protests by residents of Fuheis to the northwest of Amman, , Ministry of Environment has banned the Jordan Cement Factories Company (JCFC) from using petcoke, citing hazards to the environment and public health.

The Qatraneh cement factory is the first foreign venture that involves building the facilities from scratch. Lafarge, the French company that controls JCFC, bought the government's shares in the 55-year-old company as part of the privatisation process.

Official sources said that another Saudi investment, Yamama Cement Factory, and the Kuwaiti-Jordan Holding Company are in the process to license their own cement factories in the country.

Issa weathered worries regarding competition saying: "It is an open market." He voiced hope that this would reflect on the local prices of cement, which have recently soared amidst an unprecedented construction boom in Jordan.

By Mahmoud Al Abed

© Jordan Times 2006