East African Portland Cement Company (EAPCC) has announced plans to invest KES 30.5 billion (USD 200 million) in a cutting-edge clinker manufacturing facility in Kajiado County. The move is designed to enhance cement production capacity and optimize operational costs.
Clinker, a vital component in cement production derived from limestone or coral, is primarily sourced from the Coast, while pozzolana, an ash-based product, is commonly found in the Rift Valley. EAPCC, renowned for its high-quality products marketed under the brand name Blue Triangle, intends to establish the facility on a sprawling 300-acre parcel of land.
The proposed factory, expected to release detailed construction timelines by 2024, is projected to have an annual production capacity of approximately 5,000 tonnes of clinker. The excess clinker generated will be targeted for sale in adjacent markets, expanding EAPCC’s market reach.
Oliver Kirubai, the Managing Director of EAPCC, stated in a recent interview, “We are planning to invest KES 30 billion (USD 200 million) in a new clinker facility within Kajiado County. Over the next year, our plans will materialize as our geologists are currently on the ground conducting surveys.”
The strategic location of the plant in Kajiado County aims to facilitate swift transportation of the cement to the market upon production, enhancing market responsiveness. This move aligns with the company’s vision to address challenges in clinker production at its Athi River factory, which have affected its competitive edge in the market.
Kirubai highlighted the capital-intensive nature of the business, projecting a repayment period of up to 40 years for the substantial investment. The decision to expand clinker production reflects a broader trend among local cement firms seeking to bridge the supply gap and secure cost advantages by strengthening their clinker manufacturing capabilities.
After a significant investment of KES 500 million to refurbish its Athi River plant, EAPCC successfully resumed full clinker production in September 2022. Disruptions from frequent breakdowns had previously hindered the firm’s ability to meet market demands effectively. Other major players like Bamburi Cement, National Cement, and Mombasa Cement have also established their clinker production facilities.
Despite a promising 37 percent surge in revenue, the fiscal year ending June 2023 witnessed EAPCC transitioning from a KES 541.5 million profit to a KES 1.3 billion loss. This setback is attributed to escalated costs, notably compared to KES 2.9 billion in the preceding year, increasing the firm’s cost of sales to KES 3.9 billion.
