Displaying items by tag: Research

India: Demonetisation policy is expected to reduce cement demand by 15 – 20% until the end of 2016. It will then reduce growth by 3% in the last quarter of the Indian financial year that runs until the end of March 2017, according to a report by Deutsche Bank Markets Research. It added that investors forecast the drop in short-term demand to be ‘severe.’

Research Analyst Chockalingam Narayanan said that he expected demand from infrastructure projects to partially offset weakness in the residential sector. However, investment towards these projects may be impaired where the revenue comes from state government. These bodies rely on up to 10% of their revenue from the property sector that may be adversely effected by demonetisation. Local bodies are responsible for projects such as rural roads, urban development projects, affordable housing, irrigation and more. Larger road and railway budgets are mostly controlled by central government agencies and are expected to be less effected.

Morocco: LafargeHolcim, ArcelorMittal, Evonik and Solvay have formed a Low Carbon Technology Partnerships Initiative across the steel, cement and chemicals industries. This new partnership will look at the potential synergies that exist between the manufacturing processes of these three energy intensive sectors, and how these synergies could be harnessed to reduce CO₂ emissions.

As a first step, and following preliminary research, the innovative partnership will produce a study with the technical support of Arthur D Little to identify potential ways to valorise industrial off-gases and other by-products from their manufacturing processes to produce goods with a lower carbon footprint than through the fossil path. The preliminary research has already allowed identification of significant potential in selected trans-sector pathways.

The study is aimed at bringing a fact-based overview of carbon and energy sources from industrial off-gases (first at a European level), and evaluating the technical, environmental and economic feasibility of different Carbon Capture and Usage (CCU) pathways and their potential.

Initial findings from the first step already underway suggest that deploying cross-sector carbon capture and reuse opportunities on an industrial scale could reduce up to 3 GT/yr or 7% of global anthropogenic CO₂ emissions. Existing conversion technologies that could be deployed across the three sectors could utilise by-products in the off-gases to create building materials, organic chemicals and fuel. Increased availability and greater access to renewable energy sources would significantly boost net carbon reduction efforts by those three sectors, within a supportive legislative framework. Cross sector carbon capture and reuse should also result in job creation, to be further investigated.

The study, carried out at European level, is building the ground for similar investigation extended at global level and paves the way for identifying and assessing industrial scale projects on CCU at the interface between the sectors.

“Concrete offers the highest level of life-cycle sustainability performance and we are continuously developing new products and solutions for a low carbon society. This new ambitious partnership will support our mission to cut our net emissions per ton of cement by 40% towards 2030 (versus 1990) and to develop and further deploy low carbon solutions for the construction sector. But to make this a reality, we will need an enabling regulatory framework and support for innovation,” said Bernard Mathieu, Head Group Sustainable Development of LafargeHolcim.

Belgium: Data from the Cement Sustainability Initiative (CSI) suggests that the carbon intensity of European Union (EU) cement increased from 2008 to 2014, according to analysis by the environmental campaign group Sandbag. It adds that the sector made greater strides in reducing emissions in the years prior to the EU Emissions Trading System (ETS). Since 2011, the EU cement sector has increased exports of cement clinker outside the EU, demonstrating that the EU ETS has not made the sector globally uncompetitive.

“EU policymakers have overprotected the cement sector in the EU ETS to such an extent that companies have not taken any action to reduce their greenhouse gas emissions. The EU’s approach is killing with kindness; by maintaining the status quo on free allocation of allowances they are making their own climate targets undeliverable,” said Wilf Lytton, analyst at Sandbag.

Sandbag say that this highlights the inability of the EU’s climate policy, as currently designed, to address European cement sector emissions. Meanwhile, low-carbon new entrant cement companies operating outside of the EU ETS have commercialised technologies to dramatically reduce the carbon footprint of cement, yet are struggling to scale-up as they fight through a mass of regulation and product standards that support the high-carbon status quo.

Research by Sandbag revealed in March 2016 that incentives in the design of the EU ETS have driven higher greenhouse gas emissions emissions in the cement sector.

Saudi Arabia: A lifting of the Saudi Arabian export ban on cement is unlikely to help local cement producers much according to a research report issued by Arqaam Capital. The investment bank has predicted that export volumes are likely to be restricted to 20% of output and possibly subjected to an export tax. This tax, equivalent to fuel subsidies Saudi producers benefit from, and transport costs would reduce the price advantage Saudi producers hold over international competitors.

"The domestic supply situation remains difficult. Sector clinker stocks have not budged since July 2014, remaining at nearly 21Mt as of March 2016 equivalent to four months of output. This, combined with existing capacity of 70Mt, and incoming capacity of 7Mt due in the 2016, equates to total potential capacity of around 100Mt. This suggests a substantial near/medium term surplus of 60%, given stalled domestic contracts and the fact that few export markets are currently viable," said Mohammed Kamal, Executive Director, Equity Research at Arqaam Capital.

Arqaam Capital view Yemen, Egypt, Qatar, Jordan, UAE, Bahrain, East Africa and Iraq as potential export destinations. However, on a Freight On Board (FOB) price basis and by taking export taxes into account, only Yemen, Iraq, and Jordan are seen as viable export destinations. This then narrows the list of potential Saudi cement exporters to Southern Cement, Najran, Tabuk, Al Jouf and Northern Cement.

Europe: The Low Emissions Intensity Lime And Cement (LEILAC) consortium has secured Euro12m in funding over five years from the European Commission Horizon 2020 Grant programme to test Calix’s direct separation process to capture CO₂ emissions from cement and lime production. The consortium comprises HeidelbergCement, Cemex, Tarmac, Lhoist, Amec Foster Wheeler, ECN, Imperial College, PSE, Quantis and the Carbon Trust. The consortium will also contribute a further Euro9m towards the project.

During the first three years, the project will focus on finalising the design of the demonstration plant, to be constructed at the HeidelbergCement plant in Lixhe, Belgium once the necessary permits have been secured. The high temperature Direct Separation Calciner pilot unit will then undergo two years of testing in a standard operational environment, at a feed rate capacity of 240t/day of cement raw meal and 200t/day ground limestone respectively, on a continuous basis for several weeks.

Fundamental research on the process demands and performance will be carried out to demonstrate that the technology works sufficiently and robustly enough to be scaled up to full operational use. The project results will be shared widely with industry at key intervals during the testing.

Calix’s direct separation technology is achieved by re-engineering the process flows used in the best available technology for lime and cement calcination. Carbonate calcination occurs by indirect counterflow heating, and consequentially the flue gases are not mixed with the CO₂ emitted from the carbonate minerals. This technology is already operating at a commercial scale for magnesite calcination. It does not require any separation technologies, new materials or processes. The technology is complementary with other carbon capture methods already developed in the power and cement sector, such as oxyfuel, and can make use of alternative fuels.

HeidelbergCement released more detail on its plans to buy Italcementi last week. The main points were that Italcementi’s operations in Belgium will be sold, the Italcementi brand will be retained, its research and development (R&D) centre will assume responsibilities for the entire group and up to 260 job losses are expected in Bergamo. The integration plan is expected to be complete by 2020.

Following an update in HeidelbergCement’s preliminary financial results for 2015 in February 2016, this was more focused on the practicalities of taking over a company. Sales of assets in Belgium were expected from the moment the deal was announced in July 2015. Between them the two companies operate three of the country’s four cement plants, holding 73% of the market by cement production capacity. Selling up Italcementi’s Belgian subsidiary Compagnie des Ciments Belges will maintain the existing market balance. Once this is done, from a cement sector perspective, interaction from the European Commission on the deal should merely be a formality.

Interestingly, no plans to sell assets in the US were announced. This is more ambitious on HeidelbergCement’s part because the acquisition has far bigger implications in that country. Merging Italcementi’s Essroc subsidiary and HeidelbergCement’s Lehigh Hanson subsidiary will see HeidelbergCement become the new second largest cement producer in the US with around 16.4Mt/yr. LafargeHolcim had a relatively easy ride from the Federal Trade Commission (FTC) having to sell two integrated cement plants, two slag grinding plants and a series of terminals. As HeidelbergCement will become the second largest cement producer it seems unlikely that the FTC will be too demanding. However, post-acquisition the cement producer will own cement plants within 75 miles of each other in Pennsylvania and in Maryland and West Virginia. The FTC may take exception to this but perhaps HeidelbergCement is trying their luck to see if it can get away with it.

The decision to retain Italcementi’s i.Lab R&D centre in Bergamo, Italy raises questions about what will happen to the Heidelberg Technology Centre (HTC) in Leimen, Germany. The focus here is on making Bergamo the ‘product’ R&D division for the entire group. i.Lab was opened in early 2012 to fanfare, based in a building designed by architect Richard Meier and it cost Euro40m to build. How this fits with HeidelbergCement’s existing Global R&D team at the HTC remains to be seen.

Job losses of up to 260 personnel at Bergamo are regrettable but hardly unexpected. It may not be much comfort for any staff members facing redundancy but this figure is well below the figures bandied about in the media in late 2015 of first around 1000 and then nearer 500. Another 170 personnel will also be offered relocation packages taking the impact of the reorganisation up to about 400 of Italcementi’s 2500 workforce in Italy.

Looking at the wider situation with the acquisition this week, HeidelbergCement announced a record contract for Norcem, its Norwegian subsidiary, to supply 280,000t of cement over three years for an infrastructure project. Then, Carlo Pesenti, the chief executive officer of Italcementi, was reported making comments about the business’ expansion plans in Thailand and the Association of Southeast Asian Nations (ASEAN). Projects in Myanmar and Cambodia look likely once the acquisition is complete. Finally, the ratings agency Moody’s was drumming up attention for a market report by pointing out the implications for the multinational cement producers in India if a proposed rise in infrastructure spending gets approved. In summary HeidelbergCement and Italcementi are unlikely to benefit due to their southern Indian spread of assets and local production overcapacity.

HeidelbergCement may not be getting it all its own way but the acquisition of Italcementi remains on track so far. All eyes will be on how the US FTC responds to the deal.

Colombia: Cementos Argos will open a new concrete and cement innovation centre on 26 August 2015. The US$9.8m centre was developed in alliance with the Colombian government and Universidad Eafit. Jorge Mario Velasquez, president of Cementos Argos, has stated that the centre will strengthen and add value to the company's production chain.

Nigeria: Lafarge is considering opening its sixth research centre in Nigeria. It will be the sixth development laboratory in the network following those in France, China, India, Algeria and Brazil. Lafarge's prospective research and development director, Gilles Rochard, made the announcement on a press tour in France.

Algeria: Lafarge inaugurated its fourth laboratory dedicated to research in construction materials in Algiers on 18 November 2013. The Euro1.75m laboratory is the first such facility that the multinational cement producer has opened in Africa.

Luc Callebat, CEO of Lafarge-Algeria, described the laboratory as a "platform technology to coordinate and accelerate innovation to serve the needs of the Algerian construction market," during the inauguration ceremony. The project is intended to meet increasing demand for housing in terms of quality, cost and energy efficiency. The laboratory joins Lafarge's existing network in France, China and India.

Covering an area of 2290m², the research laboratory includes control laboratories and research in cement, concrete, aggregates and building systems. The laboratory also organises specialised training in the construction industry.

Canada: Lafarge Canada, Natural Resources Canada, the Queen's Institute for Energy and Environmental Policy and Carbon Management Canada have announced that they are investing more than US$8m to develop the use of alternative fuels at Lafarge Canada's cement plant in Bath, Ontario. This multi-partner initiative intends to produce low-emission, low-carbon fuels from local supplies such as construction and demolition site debris (wood based), railway ties, and other energy containing materials that aren't presently recycled.

"We are delighted to bring this world-class demonstration initiative to the Canadian cement industry. We believe that this project is exactly in line with our mission of building better cities by lowering our carbon footprint, making use of local fuel supplies and creating local sustainable jobs," said Bob Cartmel, President and Chief Executive Officer in Eastern Canada for Lafarge Canada Inc.

According to figures released by Lafarge, the Canadian cement industry currently emits about 3.8% of the country's carbon dioxide (CO₂) emissions and about 30 - 40% of those emissions are due to fossil fuel use.

Carbon Management Canada (CMC), a network of Centres of Excellence that supports research to reduce CO₂ emissions, is providing a US$400,000 grant over three years to a research team working on the project. Natural Resources Canada is awarding US$2.68m to Lafarge Canada to construct a full-scale demonstration plant. Other project partners include Pollution Probe, WWF Canada, Queen's University, the Cement Association of Canada, Mesa Bioenergy, Scott Environmental and Rail Link, a Metis company.