DG Khan Cement announces completion of Pakistan’s biggest $300mln plant

KARACHI: DG Khan Cement on Wednesday announced the start of the country’s biggest cement plant with around 9,000 tons/day capacity at an estimated cost of over $300 million as construction sector is booming in the market seeing a double-digit growth in the commodity’s demand.

“DG Khan Cement has completed the installation of Pakistan’s largest cement plant at Hub, Balochistan,” the cement maker said in a statement to the Pakistan Stock Exchange. “The largest vertical cement grinding mill with cope drive has started trial operations together with cement silos and packaging plant. Also, successful commissioning has been completed in raw material crushing, transportation and storage departments.”

The new plant has a capacity to produce 8,500 to 9,000 tons/day and was expected to employ 1,000 workers.

DG Khan Cement is the third biggest cement producers in the country with a production capacity of 14,000 tons/day. The cement market has now four cement plants: two located in Dera Ghazi Khan, one in Chakwal and new one in Hub.

“The cement produced in the trial run is being dispatched to customers,” the company said. “Announcement of commercial production will be made in due course of time.”

The company has been setting up the plant using European technology for the past one decade, and is estimated to cost Rs35 to Rs40 billion. The cement maker had signed an agreement with K-Electric for 40 megawatts of electricity needed for the plant.

Cement sales increased 15.1 percent to 38.996 million tons during the first 10 months of the current fiscal year of 2017/18 due to infrastructure uplifts and recovery in exports.

Local cement consumption and exports stood at 33.880 million tons in the corresponding period a year earlier, according to All Pakistan Cement Manufacturers Association’s data.

Contribution of south-based mills in aggregate sales and exports stands at around 18 percent as they sold 6.087 million tons in the local markets and exported 1.236 million tons in the July-April period.

Pakistan’s 24 cement plants have capacity of producing 47 million tons of clinker and 49 million tons of cement a year.

Local cement industry is massively investing in capacity enhancement in view of China-Pakistan Economic Corridor projects, which are estimated to cost more than $57 billion.

They planned to increase production capacity by 26 to 28 million tons to 72 million tons plus within the next two to three years.