OMAN: Oman Cement to increase cement grinding capacity

Oman Cement is weighing moves to boost its cement grinding capacity to keep pace with escalating demand for a commodity deemed vital for the nation’s continuing infrastructure modernisation.

Towards this end, the company has floated a tender for the selection of a consultant to study the best techno-commercial options for enhancing its cement grinding capacity. Based on the findings of the study, a tender will be floated during the next quarter for a turnkey contract for the implementation of the expansion project, Dr Abdullah Abbas Ahmed, Chairman, stated in the Board of Directors’ Report issued here yesterday.

The expansion is the latest in a series of upgrades undertaken by Oman Cement in recent years.Earlier this year, the company commissioned the second phase of the expansion of its third clinker production line, boosting clinker production capacity by 4,000 tonnes per day.

Following the commercial launch of the new kiln, which produced 191,840 metric tonnes (MT) of clinker during the first half of this year, the company has ceased imports of clinker.Contracts have also been signed for the upgrade of the pollution control system of Line-1, as well as the capacity enhancement of Kiln-1. The total investment in these upgrades is RO 14.27 million.

Meanwhile, Oman Cement registered a profit after tax of RO 7.330 million for the six months ended June 30, 2011, against earnings of RO 18.285 million for the corresponding period of 2010, which also included RO 7.338 million in government reimbursements related to previous years.Cement sales climbed to 944,566 MT during the first half of this year, against sales of 919,314 MT during the same period last year.

In value terms, however, revenues from cement sales declined to RO 24.812 million this year, against earnings of RO 28.822 million last year, as competition pushed down prices this year

.Profits were also impacted by the adverse movement in the fair value of investments due to stock market fluctuations, the Chairman stated.Commenting on the market outlook, Dr Abdullah said: “The demand for cement continues to be good in view of government spending on infrastructure projects.

Inflow of cement from neighbouring countries at low prices is expected to continue posing a threat due to the excess supply position there. Despite the strong competition locally and also from the neighbouring country, the company is confident of maintaining a sizeable market share in Oman.”