Venezuelan authorities planning to invest US$220m in the construction of a cement plant with the help of Iran and have already paid US$48.5m to an Iranian firm as a first installment under the deal, local press reported. The cement company Cemento Cerro Azul, which will run the new plant, will be founded as a subsidiary of the basic industries firm Compaa Nacional de Industrias Bsicas (Coniba), which itself will be launched on January 30.
The cement company and the new plant will be based close to Maturn, capital of Monogas state in northeastern Venezuela, near limestone deposits required to make the product. The plant, being built with the aid of the Iranian company Ehadasse Sanat, is scheduled to take three years to complete. Works have been under way for six months, state news agency ABN quoted Coniba president Rafael Lugo as saying.
Nevertheless, cement production in the plant is set to start before construction is finished. "The construction process has a first phase that will allow cement production to begin in 18 months," Lugo said.
The plant itself will have the capacity to produce 1Mta of cement and will have a noticeable effect on the domestic cement industry as all of it will be destined for the local market. Domestic output is currently at 9Mta.
The plan to build the plant came about as a result of President Hugo Chvez’s reiterated complaints about high cement prices in the Andean nations. Chvez had previously promised to reduce prices and it seems like this is now likely to take place.
Cemento Cerro Azul will produce Portland I/II cements and this will be sold at prices around 50 per cent lower than the present market average, Lugo said.