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Saudi Arabia Orascom Construction Industries announced that it has agreed to enter into a 50/50 joint venture with Khayyat Group, one of the leading industrial investors in Saudi Arabia with investments in building materials and real estate, in Al Safwa Cement Company. The joint venture will see the companies construct a 1.4 million tpa state-of-the-art greenfield cement plant, with an upgrade option that will raise capacity to 2 million tpa. The plant will be located in the Western Region of Saudi Arabia in close proximity to the new King Abdullah City, approximately 140 km from the city of Jeddah. Total investment cost for the 2 million t capacity is estimated to reach US$360 million. It is expected that a ThyssenKrupp Polysius/OCI consortium will erect the plant, which is expected to begin production during the first quarter of 2009. Site preparation works are already underway. The Saudi Industrial Development Fund (SIDF) has preliminarily agreed to finance the project in Saudi Arabian Riyals in an amount equivalent to US$111.5 million, with highly favourable terms and a repayment period of more than 10 years from the date of agreement. The SIDF loan constitutes almost half of the required debt for the project. This new capacity will strengthen OCI's emerging markets presence and increase total cement capacity by early 2009 to 36 million tpa. | |||||||||||||||||
