Lafarge working on $450m deals
Dubai , August 21, 2007
Cement producer Lafarge is planning two projects worth about $450 million in the Iraqi city of Kerbala, according to an investment bank working with the French company on both deals.
The world's largest cement maker by market value is bidding for $150 million contract to rehabilitate a cement plant in Kerbala with a capacity of 2 million tonnes a year, said Basil Al Rahim, managing partner of Merchant Bridge said.
Lafarge and Merchant Bridge have a licence to build another 2 million tonne-a-year plant in the city, Rahim said in Dubai, estimating that project was worth about $300 million.
'We are working on the cement plant licences in a joint venture with Lafarge and all the permits are in place,' he said.
A Lafarge spokeswoman declined to comment in Paris.
The Iraqi government has opened up the cement sector to foreign firms, hoping they will be keen to join in the reconstruction under way after years of war and sanctions.
The ministry of industry and minerals sold 19 licences for greenfield cement plants in 2005 as part of plans to raise Iraq's capacity to 25 million tonnes a year from about 17 million.
'Only three or four of those licensees have made progress like us,' Rahim said.
Egypt's Orascom Construction Industries operates one cement plant in Iraq and is due to complete a second by the end of 2007, according to its Web site.
Rahim said the Lafarge venture would find out next week whether it had been shortlisted to negotiate the rehabilitation of the second Kerbala plant. Reuters