• Sunday, May 19, 2024
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BusinessDay

Dangote-Bua, Edo and four dominating cement companies in Nigeria

Cement makers’ bumper Q1 earnings fail to reflect in share performance

By Inwalomhe Donald

Edo State is the only state in Nigeria that can boast four cement companies. Three cement companies are operating in Okpella, Etsako East local government, and one cement company is under construction in Egbema community, Ososo, Akoko Edo local government. Three of the cement companies are owned by BUA, and one cement company is owned by Dangote Cement. BUA Cement has two in Okpella. Edo North is now home to so many cement companies and solid minerals companies in Nigeria. Dangote cement, Okpella, BUA cement, Okpella, Edo Modular Refinery, Ologbo, and Duport Modular Refinery, Egbokor, in Edo State, have created an industrial hub in Edo State. Edo under Governor Obaseki. Edo has produced the first energy park and four cement companies in Nigeria under Governor Obaseki. Edo State is now dominating the cement industry in Nigeria.

Edo State is the only state in Nigeria that can boast of the establishment of four cement companies and two modular refineries between 2013 and 2024. Dangote cement, Bua cement in Okpella, Edo Modular Refinery in Ologbo, and Duport Modular Refinery in Egbokor in Edo State have become the new industrial hubs of Nigeria. The Edo production centre can boast of many companies that have changed the Edo State economy forever. The new Edo economy can create an environment for existing firms to grow, become more productive, and become cheaper. The Edo State economy can facilitate access to a larger consumer base, a greater pool of qualified workers, additional sources of financing, and new technologies in cement and modular refineries.

With four cement factories and two modular refineries in 2021, Edo State is now Nigeria’s new industrial hub. Edo State has the capacity today to reduce the price of cement and reduce the huge budget for fuel subsidies. Dangote cement, Okpella, BUA cement, Okpella, Edo Modular Refinery, Ologbo, and Duport Modular Refinery, Egbokor, in Edo State, have created an industrial hub in Edo State. Edo, under Governor Obaseki, has produced the first energy park and two cement companies in Nigeria. The new industrial hub has repositioned the Edo State economy to be viable and globally competitive; it has been able to set the pace for future growth and massive industrialization. The Edo government says the ongoing modular refinery project at Ologbo in the Ikpoba-Okha Local Government Area of the state will, upon completion, drive the state’s industrial revolution quest and reduce petrol subsidies in Nigeria.

Dangote Group is producing cement in Okpella, Edo State. It is predicted that the new plant will add millions of metric tonnes per year to the company’s current local cement output of 29.25 million metric tonnes. Dangote Cement says that work is underway to increase its total cement production capacity in Nigeria by 4.5 million metric tonnes per year before September 2022. The plans consist of new lines at the company’s cement plants in Obajana, Kogi State, and Okpella, Edo State, and the restart of production at its plant at Gboko, Benue State.

In 2009, BUA Group acquired the Cement Company of Northern Nigeria, CCNN (Sokoto Cement), and the Edo Cement Company to boost and increase the metric tonnes of annual cement production in the country. In 2018, BUA Obu Cement completed a 3 million MTPA plant, resulting in a combined capacity at Okpella of 6 million MTPA. In the second quarter of 2015, BUA signed a contract with FLSmidth for a 3 million MTPA new production line in Edo Cement to be sited at Obu, Edo State. The $600 million cement plant in Okpella, Edo State, was opened in 2015 with a capacity of 3 million MTPA, resulting in a combined 3.5 million MTPA combined installed capacity at both the Edo and Obu plants.

Apart from the initial costs, over $100 million was invested in gas turbines to power a 50-megawatt plant for 24-hour electricity generation as well as the construction of a 30-km gas supply pipeline. The world-class plant would give a much-needed boost to Nigeria’s cement industry as well as enhance the development of related sectors, including housing and construction.

Duport Midstream Company Limited of Lagos announced in late March that its upcoming modular refinery in Nigeria’s Edo State would indeed be ready for commissioning in the fourth quarter of this year. This project is being implemented by Duport alongside the Nigerian Content Development and Monitoring Board (NCDMB). NCDMB Executive Secretary Simbi Kesiyi Wabote recently toured the project site and reportedly confirmed that the project has reached approximately 80% completion. The Duport modular refinery is a small part of the country’s long-term objective of improving its industrialization. Mr. Wabote stated that “when the Federal Government enunciated the policy on the development of modular refineries, the NCDMB decided to explore ways through which we can build modular refineries to refine products locally.” Duport Midstream Company Limited is hoping to develop the first energy park in Nigeria, beginning with this refinery, and over the next five years it hopes to add a gas processing plant, a CNG plant, a refined product terminal, and a power plant in Nigeria’s Edo State.

I must commend the Edo State Governor for providing a conducive environment for cement companies, the Duport Energy Park project, and the peaceful disposition of the host communities that attracted the investment. He said the project has created job opportunities in the construction phase, and the employment numbers will multiply during the operations and maintenance phases. He emphasised that one of the key benefits of the establishment of modular refineries is the steady rebuilding of local skills in refinery operations, especially among the young workforce.

The Edo modular refinery was developed by two Chinese firms: AIPCC Energy Limited and Peiyang Chemical Equipment Company Limited. It has a capacity of 6,000 barrels per day, and it is expected to produce 50 percent of diesel (500,000 litres), 25 percent of naphtha (300,000 litres), and 20 percent of fuel oil (200,000 litres) from its feedstock. Tim Tian, managing director of Edo Modular Refinery, said the refinery will get its feedstock (crude) from the Nigerian Petroleum Development Company (NPDC) facility, oil mining lease (OML) 111, near Benin City.

Inwalomhe Donald writes from Okpella, Edo State.