Two cement producers in Oman — Raysut Cement and Oman Cement — on Sunday said that the hike in natural gas price will jack up their cost of production.
The gas price has been doubled to 41 baisas per standard cubic metres from 20.5 baisas per standard cubic metre with effect from January 1, 2015 and an annual increase of 3 per cent thereafter.
Oman Cement's costs will increase by OMR2.1 million in 2015 when the government introduces planned hikes to gas prices, the company said.
Oman Cement said the proposed gas price rises will be effective January 1 and will increase every year at rates specified by the Ministry of Oil and Gas, according to a filing to Muscat's bourse.
It would try to minimise the impact of the higher gas prices by improving productivity, restructuring its own pricing and reducing other costs. Raysut Cement's costs will rise by 3 per cent next year due to Oman state plans to introduce higher gas prices from January 1.
Raysut will try offset the impact of higher gas prices by making other cost reductions, improving efficiency and restructuring its own prices, according to a bourse filing.
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