Displaying items by tag: Resident Cement Company

There are two new cement plant stories to note in Nigeria this week. Firstly, the Kebbi State Government has signed an agreement with MSM Cement to build a 3Mt/yr plant. Secondly, drilling work has started on a forthcoming 10Mt/yr plant to be built by Resident Cement in Bauchi State.

The project in Kebbi State appears to be a new one, although the government has been looking for investors for a while. The state government and a subsidiary of MSM Group have signed a memorandum of understanding (MOU) supporting the US$2.4bn initiative, according to local press. Alhaji Muazzam Mairawani, the chair of MSN Group, said that his company intends to develop the plant in four stages, each worth US$600m. The first stage has a schedule of production by early 2027. MSN Group started out in the fertiliser business and has since expanded into the oil and gas, shipping and agricultural sectors.

The project in Bauchi State has progressed further along and is bigger. The state government signed an MOU worth US$1.5bn with Resident Cement in mid-2024. The deal also includes a 100MW power plant, a dam and other amenities for the local community. Before the main announcement of the MOU, local press reported that Sinoma Nigeria Company was investing in the project. Subsequently, Bala Mohammed, governor of Bauchi State, said that the state owns a 10% stake in the plant.

These two new project stories follow the release of the annual reports for 2024 in recent weeks by the main cement producers in Nigeria. Global Cement Weekly touched upon this last week in its coverage of the results of major multinational building materials companies including Dangote Cement. That company’s sales revenue and earnings were boosted by growing sales volumes of cement in Nigeria. This was particularly impressive given that the country continues to face economic problems including high inflation and negative currency exchange effects. Dangote Cement said it managed to overcome these problems through “increased promotional activities and improved route to market solutions” thereby upping the market presence of its products. The company also managed to grow its exports to a record amount. It shipped 0.91Mt of clinker to Cameroon and Ghana out of a total export volume of 1.2Mt.

Graph 1: Sales revenue for large cement producers in Nigeria, 2023 - 2024. Source: Company financial reports.

It was a similar story from the two other large domestic cement companies. Lafarge Africa’s net sales grew at a similar rate to Dangote Cement in 2024 and it increased its profit after tax faster. Lolu Alade-Akinyemi, the CEO of Lafarge Africa, attributed this to the company’s “strong market positioning, operational efficiency, cost management and dedication to value creation.” BUA Cement grew its sales faster than the other two. Starting production on new production lines at its Sokoto and Obu plants is likely to have contributed to this. However, the company’s net profits rose at a lower rate than its competitors in 2024. This has been blamed on the poor market at the start of the year and negative currency exchange effects related to the loans that the company took out for its new lines.

Lafarge Africa ending on a high with its 2024 results is not surprising given that the company is currently being sold by Holcim to Huaxin Cement. The transaction is expected to close at some point in 2025. Huaxin Cement issued an update at the end of February 2025 saying that its accountants had been auditing the financial statements of Lafarge Africa. It also noted the depreciation of the Nigerian Naira in 2023 and 2024. This is all fairly standard stuff but check back later in the year to see how the sale has progressed.

The cement market in Nigeria is looking positive. New plants are on the way, the large cement producers are doing relatively well and the general economy may be improving. New entrants are also entering the market. However, consumers and legislators have increasingly questioned why the price of cement has remained so high in recent years. This continues to present a tricky situation to the market as it develops.

Nigeria: Bauchi State Government, in partnership with Resident Cement, has commenced work on a US$1.5bn cement plant in Diji Village, Gwana District, Alkaleri Local Government Area, according to Arise News.

Resident Cement Group Chairman Abbas Junaid stated that limestone deposits in the area are sufficient to sustain a 10Mt/yr capacity plant for 100 years. The company has begun drilling and will deploy four rigs to complete the project within two months, with full construction of the plant to begin in three months.

Nigeria: The Bauchi State government has approved a US$7.9m road project to support the development of the Gwana cement plant in Alkaleri. 10,000 people will be employed in the construction of the plant before it commences production in the next two years, according to Leadership News. Feasibility studies for the plant have reached an advanced stage for the location of the plant by Resident Cement Company.

The plant will generate 100MW of electricity for the plant from coal, with surplus power supplied to nearby communities.

Nigeria: An update has been released on the cement plant planned in Bauchi State, on which Global Cement previously reported on 11 June 2024. On 7 August 2024, the Bauchi State government signed a Memorandum of Understanding (MoU) worth US$1.5bn with Resident Cement Company to establish a cement plant in Gwana District, the Nigerian Tribune reports. The plant is expected to produce 10Mt/yr of cement. The project includes a 100MW power plant, a dam and other amenities for the community, which will reportedly help to attract foreign investment and boost the local economy.

Nigeria: The government of Bauchi State has signed a deal with Resident Cement and Sinoma Nigeria Company for the construction of their upcoming 10Mt/yr cement plant in the state. The deal stipulates total investments by the companies of US$500m to build the plant, situated in Gwana District.

Governor Bala Abdulkadir Mohammed said "We are reassured in our commitment to maximise the available resources to exploit the natural resources Bauchi State possesses for the economic development of the state.”