Dangote Cement has revealed that it will not establish a manufacturing plant in Kenya in the medium term, citing challenges in securing suitable limestone reserves for a large-scale operation.

🇰🇪 Breaking It Down

Chief Executive Officer Arvind Pathak made the disclosure during Dangote Cement’s Capital Markets Day in London on September 21, where he outlined the company’s expansion plans across its African markets.

Pathak said Kenya is currently excluded from the company’s business plan targeting production of 80 million tonnes, which currently entails an expansion of 25 million tonnes.

“Right now in our business plan, which we have presented for 80 million tonnes, Kenya is not figuring in that. So in this period, that is the medium term, we do not envisage to have a plant in Kenya,” he said.

📌 What You Need to Know

He explained that the company has identified sizable and high-quality limestone resources in several countries where it already operates, but has yet to secure a comparable opportunity in Kenya.

The CEO said Dangote would remain open to establishing a presence in Kenya if it finds limestone reserves that meet its requirements in terms of size, quality and proximity to the market.

He explained that Dangote’s East African expansion will instead concentrate on Ethiopia, where its existing operation is producing at maximum capacity.

Dangote Cement’s West Shewa plant in Mugher, Ethiopia, currently has a production capacity of 2.5 million tonnes per year and is being expanded to increase output as part of the company’s wider growth strategy.

The company is also undertaking a low-cost optimisation programme at its Ksh65 billion (USD500 million) Mtwara plant in Tanzania , which is expected to increase production capacity by 16 per cent.

Dangote’s Mtwara facility currently produces about three million tonnes of cement annually and operates at roughly 85 to 90 per cent capacity.

📰 Source: Kenyans.co.ke