Displaying items by tag: Akhangarancement

Uzbekistan: Russia’s Eurocement has signed an agreement with Uzqurilishmateriallari to build a 2.4Mt/yr cement plant. It is scheduled for completion by 2020. The new plant will be Eurocement’s second plant in the country and it will increase its total cement production capacity to over 4Mt/yr. Eurocement already owns a 84% stake in Uzbekistan’s second largest cement producer Akhangaracement after purchasing a 76% stake in it from Switzerland’s Zeromax in 2006.

Russia: Eurocement's Akhangarancement plant produced 164,000t of cement and 127,205t of clinker in August 2015, 2.5% and 12.2% year-on-year rises respectively. The plant shipped 164,863t of cement to in August 2015, a 1.2% year-on-year rise.

The most popular types of cement in August 2015 were PC 400-D20 (Portland cement of grade 400 with active mineral additives accounting for more than 5 - 20%, SPC 400 (Slag Portland cement of grade 400 with active mineral additives accounting for 20 - 80%), PC 400-KD20 (Portland cement of grade 400 with composite additives accounting for 10 - 20%). The share of these types of cement was 91.8%, up from 75.1% in August 2014.

Uzbekistan: The Tashkent Regional Economic Court in Uzbekistan has seized the assets and bank accounts of JSC Akhangarancement, a subsidiary of Russia's Eurocement Group, according to an Akhangarancement statement. The move follows the granting of a suit brought by the Uzbekistani State Competition Committee on 21 July 2014 regarding the privatisation of the cement producer in 1994, which it is investigating.

Money in bank accounts equivalent to US$177.8m and fixed assets amounting to US$19.1m were seized. An Akhangarancement source said that, despite the seizure of the accounts, the plant continues to work as usual and produce cement.

Eurocement Group claims that the State Competition Committee's claims are contrived and it plans to appeal the decision of the regional court at a higher court. Eurocement has 30 days to file an appeal. If the court upholds the first ruling, this will essentially mean the nationalisation of the asset.

Eurocement became a shareholder in Akhangarancement eight years after it was privatised, buying 75.5% of its shares on the secondary market in August 2006. Currently, Eurocement Group's stake in the enterprise is 83.9186% or 4,136,269 shares, of which Switzerland's Eurocement Holding AG is the direct owner. The rest of the shareholders are private individuals.

Uzbekistan: Eurocement has become the third Russian company to risk losing assets in Uzbekistan after Wimm-Bill-Dann Foods (WDB) and MTS. The president of Eurocement, Mikhail Skorokhod, said that the Tashkent Region's Economic Court has granted a suit brought by Uzbekistan's State Competition Committee to invalidate the privatisation of JSC Akhangarancement, which was based on a decree that was signed in the mid-1990s. Eurocement became a shareholder in Akhangarancement eight years after it was privatised, buying 75% of its shares on the secondary market in 2006.

"We bought Akhangarancement in 2006," said Skorokhod. "We met all of the local legislative requirements, paid taxes and contributed to the solution of social and environmental problems. The enterprise was inspected from time to time, but no serious complaints were made. A few months ago a spot check involving nearly 20 organisations began. Despite the unprecedented scale of the inspection, nothing was found that violated the law. We found out on 16 July 2014 about the State Competition Committee's lawsuit to overturn the decree of 30 August 1994 on the privatisation of Akhangarancement. The Tashkent region's Economic Court accepted the suit on 17 July 2014 and the ruling was made on 21 July 2014 morning, in literally a few hours."

According to Skorokhod, the lawsuit cites items that were not taken into account in the privatisation, but none of them are capital assets (such as seedlings, furniture, enclosures, printers and trailers). Uzstroymaterialy, the state company that oversees the industry and Uzbekistan's Justice Ministry have deemed the lawsuit unfounded, but the court did not take its position into account.

Eurocement has 30 days to file an appeal. If the court upholds the first ruling, this will essentially mean the nationalisation of the asset. The plant is continuing to produce cement as usual. "If we don't get a positive court ruling in Uzbekistan, we will file a lawsuit in the International Centre for Settlement of Investment Disputes (ICSID) at the World Bank in Washington," said Skorokhod.

The attempted nationalisation is particularly troubling to Eurocement in light of the expansion plan it has for the plant. Eurocement has signed a contract with China CAMC Engineering Co Ltd for the provision of equipment, designs, installation supervision and employee training worth Euro95.0m for the construction of a new dry-process cement plant as part of the Akhangarancement plant. The new plant's capacity will be 2.4Mt/yr of cement. The launch is expected in 2016.

The contract includes the provision of the full range of equipment required for cement production, including mechanical equipment, furnaces, cyclone pre-heaters, grinders, mills, electrical and automatic equipment and monitoring and measuring devices.

Uzbekistan: Uzbek media has reported the launch of a criminal investigation and financial audit of Akhangarancement, a cement plant that is 84% owned by Russia's Eurocement in Akhangaran, Tashkent province.

State investigators are focused on alleged tax evasion, theft of assets, reporting irregularities and illegal activities of managers. Akhangarancement's general director Denis Dotsenko has reportedly left the country.

According to local media, the investigation was motivated by illegal cement exports for the construction of the Rogun hydroelectric power plant and associated dam in neighbouring Tajikistan. The Rogun plant would significantly reduce water supply from the Syrdarya River, which is of vital importance for Uzbekistan's cotton production, its major export earner.

Our spotlight is on Uzbekistan this week following an update on the Almalyk Mining and Metallurgical Combine's (AMMC) plans to build a new cement plant in the south of the country. The news emerged in the wake of the completion of the AMMC's cement grinding plant, in the Jizzakh region, which was finished in late March 2014. Meanwhile, Eurocement announced that its subsidiary in Uzbekistan, the Akhangarancement plant, had received a limestone and marl quarrying licence.

Previous to the new AMMC grinding plant, Uzbekistan had five cement plants with a total cement production capacity of nearly 6Mt/yr. Only one of these was a dry production process plant, the 2.5Mt/yr Krzylkumcement plant, in the south-western Bukhara province. Cement consumption in the country was estimated to be around the same, also at 6Mt/yr.

Back in 2011 the government of Uzbekistan planned to invest US$6.94bn to develop infrastructure, transport and communication construction from 2011 - 2015. This investment has now been followed up with a direct financial injection into the cement industry.

In late February 2014, local building materials company JSC Uzbuildmaterials announced government plans to invest US$49.1m into the local cement industry. The programme includes nine projects for the three largest cement plants in the country: the Kyzylkumcement plant, the Ahangarancement plant and the Bekabadcement plant. Kyzylkumcement will receive the majority of the investment, US$39.6m to spend over three years on a new cement mill, upgrades to the clinker production lines and construction of a 220/10kV main substation. Ahangarantcement and Bekabadcement will replace 'out-dated' equipment and will upgrade their production lines.

Mineral-rich Uzbekistan is relatively undeveloped but this is changing. Its Gross Domestic Product (GDP) was reported to be US$51bn in 2012 by the World Bank, having seen steady growth since 2002, and its population was just over 30m in 2013. Its cement consumption is 300kg/capita, a figure below the global average (estimated at 536kg/capita in a forthcoming Global Cement Magazine report on 'Cement consumption versus Gross Domestic Product'). This places Uzbekistan in a favourable position for future development on a graph of GDP per capita against cement consumption per capita. The latest investment programme suggests that the Uzbek government are hoping that this is the case.

Uzbekistan: OJSC Akhangarancement, a subsidiary of Russia's CJSC Eurocement Group, has received a limestone and marl production license for the Shavazsay field in the Almalyk region of Uzbekistan. A special commission of the Uzbekistan government issued the license, which covers the extraction of non-ore mineral resources.

The Shavazsay field, which was opened in 1974, has resources of 36.4Mt of limestone. Preliminary data shows that these resources will last for 25 years given Akhangarancement's current capacity.

Akhangarancement is one of the largest cement producers in Uzbekistan, with a 30% share of the market. It exports mainly to Kazakhstan, Kyrgyzstan and Turkmenistan. The company is projected to produce 1.99Mt of cement in 2014. Cement production increased by 6% in 2013, while clinker production increased by 13% in the same period. The company's mountain division produced 1.64Mt of limestone in 2013, up by 19% on 2012.