Orascom Construction Industries (OCI) announced that cement and clinker production at its new plant in Pakistan has commenced onschedule. OCI subsidiary Pakistan Cement Company (PCC) owns the property, plant and equipment of a 2.2Mta cement plant supplied by FLSmidth located along the Lahore-Islamabad highway in the Punjab Province of northern Pakistan. OCI acquired a majority stake in Pakistan Cement Company, formerly known as Chakwal Cement Company, in March 2005. Currently, OCI owns62.75% of total the outstanding shares in PCC.
OCI Chief Executive Officer, Nassef Sawiris commented "the commissioning of our greenfield cement plant in Pakistan comes at an important time for the cement market in Pakistan. Cement demand which is up 14% during the first half of 2006continues to grow rapidly mirroring strong GDP growth. The addition of Pakistan to the OCI Cement Group portfolio of operational plants raises our consolidated capacity to 20Mt as planned."
To complete the construction of the new cement plant, PCC secured financing earlier this year through a syndicate of 11 Pakistani banks and the EksportKredit-Fonden (EkF), the Denmark-based international export credit agency, for the equivalent of USD130m in limited recourse project finance debt which is provided in Pakistani Rupees. The total investment cost for OCI in Pakistan for the greenfield plant is US$177m implying US$80/t.