Three European companies-F. L. Smith; Polysius; KHD Humbolt; and Sinoma CDI and CBMEC from China may be part of the shortlisted companies to bid for the construction of a new two million tonnes production line for BUA's Edo cement plant.
Besides, the group has concluded arrangements to raise the production capacity of Sokoto-based Northern Cement Company of Nigeria (CCNN) from its current production capacity of 500,000 tonnes to 700,000 tonnes a year.
BUA had earlier acquired CCNN and Edo Cement Company at Okpella Edo State, under a N15 billion deal.
The expansion scheme will also involve the conversion of CCNN's power source to coke, to make the company's production costs to be more competitive.
CCNN's directors, at a recent board meeting, where Abdulsamad Rabiu emerged chairman of the company, by virtue of being majority shareholder, approved the facility upgrade scheme.
Some of the companies in the construction and cement industries that have received the tender documents and are expected to feature in the bidding process are three European companies-F. L. Smith; Polysius; KHD Humbolt; while Sinoma CDI and CBMEC from China are also in the race.
Rabiu disclosed that BUA is currently holding talks with Gaslink and Nigerian Gas Company, with the aim of extending gas supply to Okpella, which is only 20 kilometres from a major gas pipeline, to power its production process.
Rabiu lamented that "the company spends huge sums of money on Low Pour Fuel Oil, (LPFO), which is transported by road all the way to Sokoto."
He added that "the initiative will save the company substantial sums of money once the conversion to coke is in place." This, according to him, is part of the massive investment envisioned in the expansion plan.
Already, BUA has sent out tender documents for the construction of a new two million tonnes production line for its Edo cement plant.
Rabiu expects that the cost of the new two million tonnes production line, together with the civil works, power and earth moving equipment would not exceed $300 million. Tender documents, which had gone out since January 2010, were being expected with prices/quotes by mid April, while the contract would be consummated by the end of June.
However, the expansion programme for the Sokoto plant was scripted, under an expenditure profile of $50 million (N7.5 billion), through a bridge financing agenda within the next two months.
At the acquisition of the two companies last year, Rabiu had unfolded plans to upgrade and modernise the production capacity for Edo Cement Company by installing a new two million tonne capacity line before the end of 2012, which will bring the total production capacity of the company to 2.4 million tonnes a year, from the current 400,000 tonnes.
BUA, in making the acquisition of Edo Cement Company and CCNN, retained the current foreign technical management in both companies, both for their expertise in cement production and continuity.
CCNN was founded by the Premier of the then Northern Region, Alhaji Sir Ahmadu Bello. It was incorporated in 1962 and commenced production in 1967 with an initial installed capacity of 100,000 tonnes a year, using the wet process of production, at the Kalambaina Plant.
The need to meet the increasing demand for cement necessitated the expansion of the plant, with the commissioning of a second line, through an installed capacity of 500,000 tonnes a year, in 1985, by the then Head of state, Major General Muhammadu Buhari.
Thereafter, in 1986, the first line was shut down due to its uneconomic mode of operation, thus leaving the plant with an out put of 500,000 tonnes a year.
