Sephaku Cement, which will commission two cement plants in South Africa with a total a capacity of 2.2Mta by 2012, believes its plants will be between 15 per cent and 20 per cent more efficient than existing plants in South Africa.
Pieter Fourie, the chief executive of Sephaku Cement, said the average age of existing cement kilns in South Africa was 33 years and the oldest kilns were 50 years old, while its plants would have new technology and logistical advantages. This was particularly because of the positioning of its Delmas plant near its flyash supplies.
This would result in Sephaku Cement’s costs being lower and its margins higher, said Fourie. He was speaking at a function on Monday to announce the formal conclusion of the ZAR1.1bn investment into Sephaku Cement by Dangote Industries, the largest industrial conglomerate in Nigeria.
Sephaku Cement is establishing new cement plants in North West and Mpumalanga at a total cost of R3.3bn. The balance of the finance for the construction of the plants will be funded by debt guaranteed by Dangote.
The investment by Dangote has resulted in it gaining a 64 per cent shareholding in Sephaku Cement, with the balance held by JSE-listed Sephaku Holdings.