Displaying items by tag: Fuel

Bolivia: Fábrica Nacional de Cemento (FANCESCA) will temporarily halt production due to a diesel shortage, which it attributed to the country’s ‘difficult economic, political, and social situation’, according to La Razón newspaper.  The company said it had not received supplies since mid-May 2025. In a statement, it said that it faces a “severe restriction on the supply of diesel, a fundamental element for the operation of our production equipment and for the transportation of cement.”

The producer added that it had written to Yacimientos Petrolíferos Fiscales Bolivianos and the National Hydrocarbons Agency requesting urgent fuel delivery. It expressed apologies to customers and partners and said it would resume operations immediately once fuel supplies returned. The government said the shortage stemmed from roadblocks preventing the transport of diesel and gasoline.

UK: Holcim UK will roll out Fuelre4m’s Re4mx fuel reforming technology across more than 200 sites nationwide, following three years of testing that the company says improved fuel efficiency and helped reduce emissions across operations.

Holcim UK supply chain director Edern Lalanne said “This agreement is the result of meticulous testing, collaboration and operational learning. We have seen consistent results with Re4mx across a wide range of use cases, and it aligns directly with our commitment to sustainable innovation and operational excellence. This is about measurable outcomes, not promises, and Fuelre4m has delivered both the data and the support to back it up. This is part of our mission to make sustainable construction a reality and continues our journey to achieve net-zero by 2050.”

Re4mx will be delivered in pre-measured containers and dosed directly into on-site fuel systems. Holcim says that the rollout has been designed for ease, speed and zero disruption to infrastructure or workflows. Manufacturing is underway, with shipments to the UK beginning once production is complete. From there, Re4mx will be distributed site-by-site across Holcim’s network, through Fuelre4m’s VIRDIS (Virtual Distribution) system, in preparation for full dosing from 1 September 2025.

Saudi Arabia: Northern Region Cement has announced a projected 10% increase in production costs following Saudi Aramco's adjustment of fuel prices.

The company stated that it will explore strategies to mitigate the financial impact, focusing on cost reduction and enhancing production and operational efficiency.

Saudi Arabia: Tabuk Cement has announced a 10% increase in production costs following a fuel price adjustment by Saudi Aramco, effective 1 January 2025. The financial impact will reflect in the company’s results from the first quarter of 2025.

Jamaica: Caribbean Cement Company has reached a milestone in its kiln expansion project with the installation of a 160t-capacity surge bin and solid fuel equipment.

The development ensures a stable and increased fuel supply to the kiln during cement production, according to Loop News.

Jorge Martinez, managing director of Caribbean Cement, said “The successful installation marks a significant step forward in enhancing our production capabilities. This investment is a main milestone of the expansion project to be completed in the first half of 2025 with the aim of increasing the efficiency and stability of our operations. It also demonstrates our commitment to meeting the local demand for cement.”

US: Cemex and Clean Energy Fuels have entered into a fuelling agreement to supply renewable natural gas (RNG) to 39 of Cemex US’s ready-mix and cement bulk trucks in Southern California. The agreement is projected to provide around 1.1Ml/yr of RNG. Cemex plans to complete the project by the end of 2024 and start fuelling the trucks on-site soon after.

Francisco Rivera, Cemex US Regional President West Region, said "As leaders in the building materials industry, we recognise the pivotal role we play in building a more sustainable future. Embracing renewable fuels isn't just an option; it's an imperative.”

Iran: 70% of cement plants by capacity were reportedly using the low-quality heavy fuel oil mazut as cement fuel on 13 January 2024. Iranian Labour News Agency has reported that plants transitioned to the fuel from natural gas amid an on-going gas shortage. This has led to a rise in costs and increased pollution from cement plants.

Iran’s Cement Industry Employers’ Association said that the industry’s supply of natural gas has dropped to 7Mm³/yr, from 27M³/yr normally.

Eastern Province Cement said this week that it had awarded a new production line project to Sinoma CDI. The subsidiary of China-based CNBM Group and Sinoma International Engineering has picked up the contract to build a 10,000t/day plant from design to installation at the cement producer’s Al Khursaniyah plant. Word on project finance is to follow later and the contract should be signed by the end of March 2024. The cement company last mentioned the project to the Saudi Exchange back in March 2023, when it suggested that it was focusing on upgrading existing lines at its Al Khursaniyah plant rather than building a brand new clinker plant at Najibiyah. The plans for the latter project date back to 2015. Eastern Province Cement holds limestone extraction licences in both locations.

It is worth noting that the last couple of new conventional production line projects announced in Saudi Arabia have been picked up by Sinoma International Engineering and related companies. Sinoma International Engineering won an engineering, procurement and construction (EPC) contract to build Southern Province Cement's upcoming Jizan cement plant in May 2023. This followed the awarding of a new 10,000t/day line by Yamama Cement, also to Sinoma International Engineering, in November 2022. However, Germany-based IBAU Hamburg was confirmed by Hoffmann Green Cement Technologies (HGCT) in September 2023 as being the company that would build a ‘clinker-free’ cement plant in Saudi Arabia in 2024. This will be a copy of HGCT’s H2 plant in France, which uses a combination of activated clay, ground granulated blast furnace slag (GGBFS) and gypsum to manufacture its products. HGCT has signed a deal with Shurfah Group to build several Hoffman plants under a 22-year exclusive licensing agreement.

Arguably though, despite all these new plant news stories, the bigger issue so far this year was Saudi Aramco's decision to raise its feedstock and fuel prices from the start of 2024. Several Saudi cement producers released warnings in response that production costs would rise and earnings would fall. Al Jouf Cement, Arabian Cement, Qassim Cement, Saudi Cement, Yamama Cement and Yanbu Cement each made statements to shareholders on the issue, saying that they were working out the impact, would announce what this might be when known and that it was likely to make a difference from the first quarter results onwards.

The timing of Aramco's price hike is poor given that after a tough year, with falling sales for some producers, demand was expected to pick up somewhat. Aljazira Capital, for example, in a cement sector report released in late December 2023, forecast a 3% year-on-year increase in cement sales volumes in 2024 following an estimated fall of 8% in 2023. Its reasoning was that the domestic housing construction market had declined in 2023, leading to high levels of competition in the central region of the country caused by high levels of company inventory. Looking ahead, the competition was expected to ease as more projects were generated outside the central region and demand from the country’s various large-scale infrastructure plans took off. We will have to wait for Aljazira Capital’s next report to find out how they think the market will cope with higher fuel costs, but it seems likely that business may remain tougher than expected for the cement producers in the short term at least.

Finally, one more story to consider is that Al Jouf Cement signed a deal with Rabou’ Al-Taybeh Company this week to export cement and clinker to Jordan. The initial period covers six months with the option for renewal. Up until 2022, at least, clinker exports from Saudi Arabia were growing most years since the export rules were relaxed in 2017. With a difficult market reported domestically in 2023, the appetite to focus on exports may be growing and this could be a sign of that. Another example this week of Saudi-based cement companies looking outside the domestic market could be detected when Northern Region Cement said it had sold a 49% stake in its Iraq business to Al-Diyar Al-Iraqia for Investments Company. The cement company said that the new strategic partnership would help it to further expand its investments in the promising market. It will use the proceeds of the deal to repay loans and for ‘external investments.’ It valued the transaction at just under US$44m. For more on what Northern Region Cement and others have been up to in Iraq, see Global Cement Weekly’s analysis from November 2023.

The steady stream of new clinker production lines suggests confidence in the cement sector in Saudi Arabia in the medium to long term. It is also fascinating to witness a secondary cementitious material plant like the one HGCT is planning on the way too. Unfortunately though, the recent fuel price rise looks like it might ruin the party in the short term for those hoping for better things in 2024.

The 26th Arab International Cement & Building Materials Conference and Exhibition takes place in Cairo on 15 - 17 January 2024. Visit Global Cement at stand N3

Saudi Arabia: Utilities provider Saudi Aramco has notified Saudi Arabian cement producers of a rise in the price of its feedstock and fuel products from 1 January 2024. Zawya News has reported that Saudi Kayan Petrochemical Company forecast the effect of the price rise to be a 1.2% increase in producers’ cost of sales in 2024.

Yanbu Cement said “The impact of changing the price of fuel products will lead to an increase in the cost of production.” Umm Al-Qura Cement echoed the concern, while Saudi Cement Company said that it is working out the extent of the financial impact and will study ways to mitigate it.

Nigeria: Dangote Cement recorded sales of US$1.9bn during the first nine months of 2023, up by 29% year-on-year from nine-month 2022 levels. The group’s sales volumes of cement and clinker both dropped. The Premium Times newspaper has reported that Dangote Cement’s costs rose by 33%, primarily due to increased spending on electricity and fuel. Nonetheless, its profit after tax grew by 30%, to US$351m.