Beirut (APD) - Jordan's booming construction sector is driving the country's two cement companies to increase production capacity in order to meet rising demand on cement and clinker.
Jordan Cement Factories Company (JCFC), the country's sole listed cement manufacturer, posted a 22% increase in its sales to JD 204 million for 2005 and net profits of JD 67 million with an increase of 28.7% over 2004, according to media reports.
JCFC controls over 97% of cement and clinker production while the state-owned Arab Company for White Cement Industry (ACWCI) accounts for the rest.
Company | Nominal Capacity (cement) | Actual Production (cement) | Nominal Capacity (clinker) | Actual Production (clinker) |
Jordan Cement Factories Company | 4838 | 3907 | 4428 | 3700 |
Arab Company for White Cement Industry | 120 | 120 | 115 | 110 |
(2004 Figures) thousands of tons/year (Arab Union for Cement and Building Materials)
To counter rising fuel costs in the energy-intensive business, JCFC recently expressed willingness to use 56,000 tons of oil shale from the Lajoon area in Karak to use it in the production of cement.
"The cost of the energy used in the cement industry in Jordan is the highest in the world, and we must search for alternatives," General Manager Rasheed Ben Yakhlouf stated two months ago. JCFC had already launched some attempts to use oil shale instead of fuel oil.
According to the Jordanian Natural Resources Authority, Jordan has a reserve of oil shale estimated at 40 million tons, enough to meet its demand for decades.
But besides reducing the cost of energy used in producing cement, Jordan is in urgent need for an increase in cement production because of the construction boom that the country is witnessing.
This boom is exemplified in high-profile tourism, residential and urban development projects such as the UAE-based Tameer's residential project to develop around 7,000 apartments and the Ayla Resort project, which is a man-made lagoon surrounded by a multi-purpose (tourism, residential, and recreational) real estate project.
Other important projects are the $620 million Saraya Aqaba development which will include hotels, restaurants, residential buildings and several recreational facilities, the $500 million Tala Bay, Aqaba City Center, the $1 billion Royal Metropolis in Amman, and the $340 million Abdali Investment and Development Project for a new downtown district in the Jordanian capital.
Apart from these large projects, Jordan has seen strong general growth in construction in 2005. New construction permits rose by 28.6% in the first six months of 2005, driven by a strong second quarter where such permits jumped by 46.9% compared to the same period of 2004 to reach 6.244 million square meters.
Against the likelihood of continued rising demand for cement, calls are getting stronger for liberalization of the cement industry that would allow for creation of more cement manufacturing firms. [TS-FC]By Nadim Issa, APD Staff Writer in Beirut
© APD (Arab Press Digest) 2006
