In order to increase its capacity especially for the construction of the Bui Dam and to meet future cement demand, Ghana Cement Limited (Ghacem) is embarking on feasibility studies to increase its production capacity by 1Mta by January 2010, according to Morten Gade, Managing Director of Ghacem.
He said that Ghacem as the leader in the local cement industry, has a total production capacity of 2.4Mta between while its competitor has a production capacity of 1.1Mt.
Total installed cement capacity in Ghana excluding the import terminal in Tema for finished cement is 3.5Mta which is more than sufficient to meet the annual demand in Ghana of 2.8Mt.
In addition, he said the company needs to secure reliable supplies of thermal energy such as natural gas, coal, petcoke or HFO to fire the kiln.
"Unfortunately, we have so far not found deposits of limestone in sufficient quality and quantity to invest in local clinker production," he said. However, Mr. Gade said Ghacem is still actively searching for local limestone with the objective of producing clinker domestically or in the region.
He explained that from July 2005 to the end of last year the clinker costs increased by US$19/t. Out of this increase US$17 was due to increased sea-freight. "This cost we would have saved if we produced clinker locally".
Mr. Gade noted that in the same period from July 2005 until today, Ghacem ex-gate price has only increased with US$15/t, meaning Ghacem has increased the ex-gate price with less than the increased costs of raw materials.
On the price of cement, the Managing Director said the fact still remains that power is imperative to the production and supply of cement to the market and therefore the shortfall in energy supplies has a direct impact on the optimum production and distribution of cement to the market.