Gulf Cement start-up seen within two years, Qatar

Gulf Cement start-up seen within two years, Qatar
Published: 12 June 2007

The newly-established Gulf Cement Company, which has set a target of 5000tpd, is slated to start production within the next two years.

The Doha Securities Market-listed company has contracted  FLSmidth for the supply of machinery and systems and Simplex Infrastructures, one of India’s construction majors, for onshore tasks.

Gulf Cement chairman Abdulla Nasser al-Misnad yesterday signed agreements with FLSmidth president and CEO Jorgen Huno Rasmussen and Simplex Infrastructures director Apurba Mukherjee.

“The execution schedule set for the plant has been positively rolling from the first of May 2007, and cement is expected to be produced in less than two years,” al-Misnad said.

Pointing out that Qatar, which has excellent economic development and prominent advantages, was being positioned as a hub of quality businesses and services, he said it had triggered plans for multi-billion projects of varied activities, placing considerable responsibilities on the construction industry.

The construction industry’s heightened tasks “spurred the demand for already scarce cement, which became a matter of major concern”, he said.

Stressing that Gulf Cement had adopted the best available technology, al-Misnad said: “We are certain that the plant will be a prominent model in the region in its technical, quality, economical and environmental-friendliness dimensions.”

Though the company, with a capital base of QR800m, has set an initial capacity of 5000tpd, it could be enhanced in a phased manner, depending on the market conditions, the officials said.

The company, which tapped the equity market with a QR640m Initial Public Offer at QR10 a share in April, had earlier roped in India-based DCIL and Germany’s GECS as consultants for the chemical and civil works in its plant, whose production capacity could be scaled up to 10,000tpd.

The establishment of the company also comes in the backdrop of shortage being witnessed in raw materials, which is seen as one of the reasons for the short supply of real estate properties and hence the higher rents that are driving up inflation, which currently stands at 15%.

The total domestic demand for cement is 14,000tpd while output as of now is only 7500tpd, thus offering huge potential for the company, analysts said.

“Normally, one would expect problems associated with the strategies in a duopoly market but the scale and magnitude of the expansionary policies of Qatar is so large that it is all-inclusive,” one analyst said.