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Operating in Egypt – Part 2

World Cement,

Read Part 1 of Operating in Egypt here.

Alternative energy production methods

Suez Cement is investing resources in the analysis of other energy production methods, including best practices. Its findings show that solid fuels, such as coal, petcoke and waste-derived fuels could be viable solutions.

“We are in the initial stages of retooling our energy strategy. Our hope is to implement innovative energy production solutions at our plants within the next two to three years, which will entail converting our current infrastructure to support new energy production schemes,” explains Carré.

Carré concedes that there are serious concerns about the environmental impacts of coal energy, but points out that research indicates 81% of European cement producers meet their energy needs via coal and petcoke products. Furthermore, many global cement firms depend on coal to power their facilities, even in oil-producing countries like the United Arab Emirates and Kuwait. He emphasises that the European Union boasts some of the most stringent environmental protections in the world, which have prompted coal technology to evolve into a cleaner and more efficient fuel. Continuous improvements in technology have dramatically reduced or eliminated many of the negative environmental impacts traditionally associated with the use of coal.

“We are committed to doing our part to deploy the same technologies as the ones used in Europe, where coal is used as the main source of energy for cement plants without causing harm to the environment or to the health of the population; we plan to install similar filtering and handling equipment here in Egypt,” he affirms.

Investment in state-of-the-art technology

In addition to grinding facilities for coal and petroleum coke, SCGC is also building new facilities to collect and process waste from landfills and farms. In December 2013, the company inaugurated the first waste-processing plant located inside Kattameya cement plant that converts pre-sorted waste into fuel. The facility is the first in Egypt and was designed with state-of-the-art equipment and technology. The scheme is part of Suez Cement’s strategy to boost the amount of energy it acquires via refuse-derived fuels (RDF). The facility is being built in compliance with Egyptian environmental law and is expected to process 35 Kt of waste and provide up to 20% of the fuels required by the plant.

SCGC believes that opportunities to invest in renewable energy in Egypt are huge. In fact, the company is in the final stages of the design phase of a large wind energy project. Italgen, Suez Cement’s parent company, together with other investors, has committed €130 million in the first phase of the first privately-owned wind farm in Gabal El Zeit near Hurghada, which, when completed, will produce enough energy to cover 40% of Suez Cement’s power needs. Phase I is slated to produce 120 MW of electricity with the hope of eventually producing 400 MW of power in subsequent phases. The electricity will be transmitted to plants run by Suez Cement as part of the Group’s plan to incorporate a higher percentage of renewable power in all of its facilities. Carré says, “Until now, this energy challenge has prevented us from manufacturing the quantities of cement needed by the market. However, I am confident that our strategy with the proposed solutions will enable us to overcome this challenge and remain a market leader.”

Suez Cement considers safety and security as fundamental values to be integrated in all its activities.

Construction industry to drive economic growth

The Egyptian economy’s recovery includes stimulus packages involving funds earmarked for major infrastructure projects. Suez Cement forecasts that the construction sector will require growing quantities of cement and cement products as the projects get underway. Some of the construction is targeting densely populated areas, while other projects are taking place in previously undeveloped areas to provide housing developments for Egypt’s growing population.

Carré is “confident the construction industry will be one of the main drivers of economic growth in the coming years, providing much-needed job opportunities for Egyptians and ensuring demand for cement continues to rise.” Suez Cement believes in Egypt’s significant growth potential and trusts that once stability is restored, Egyptians will begin to enjoy the economic recovery they have been waiting for.

To be sure, there are bound to be challenges on the way, in terms of budget, trade and energy deficits, as well as falling currency reserves and increasing pressure on impoverished communities. However, the company remains optimistic that Egypt’s new government, regional allies and other international donors will help the country solve these issues. “While we have faced many challenges over the last few years, Egypt’s economy is headed towards stability,” says Hisham Fahmy, CEO of the American Chamber of Commerce in Egypt. “Because of strong industry leaders like Suez Cement leading the way, Egypt’s economy will only continue to grow.”

The cement industry, with the leadership of Suez Cement, has an important role to play in ensuring the country’s economic growth returns by remaining competitive, innovative and a source of employment for tens of thousands. Carré is confident: “We can help Egypt’s recovery given our plans to invest in new energy solutions, as well as sustainable environmental practices and corporate social responsibility programmes.”

Written by Fayrouz Saad. This is an abridged version of the full article, which appeared in World Cement’s May 2014 issue. Subscribers can view the full article by logging in.

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