Bamburi to set up Sh32b clinker plant after Amsons takeover

Amsons CEO Mokate Ramafoko (left) and Bamburi Commercial Director Martin Kariuki (right) launch a Ready-mix concrete truck at Bamburi’s new Mombasa plant. (Jenipher Wachie, Standard)

Bamburi Cement yesterday announced that it would invest $250 million (Sh32 billion) in a clinker production plant at Matuga in Kwale County, marking the first major investment by the firm since its acquisition by the Tanzanian conglomerate Amsons Group.

Construction of the plant, which is expected to double Bamburi’s cement production capacity, will start in the first quarter of next year and is expected to start clinker production by 2028.

It will have a capacity to produce 1.6 metric tonnes of clinker annually. 

President William Ruto witnessed the signing of the contract between Bamburi and Sionama CBMI Construction Co, the firm that will put up the factory.

The President said the investment feeds into the government’s ambitious Sh5 trillion infrastructure programme, noting that such private sector initiatives would play a major role in meeting Kenya’s development goals. 

Bamburi said the turnkey clinkerisation factory would increase its cement production capacities, from about one million tonnes to 2.6 million tonnes for clinker and from 1.8 million tonnes to four million tonnes for cement.

The firm also noted that the plant would not only supply Kenya’s needs, but also enable the country to start exporting clinker to the region.

“The new clinker line will greatly reduce reliance on imported clinker, improving quality production consistency and securing supply for the domestic market. This will save Forex resources, stabilise pricing, enhance production planning, and ensure Bamburi continues to meet rising cement demand driven by national infrastructure programs and private sector development,’’ said Bamburi Cement Chief Executive Mohit Kapoor.

Amsons Group Managing Director Edha Nahdi said the investment would play a part in contributing to Kenya’s Sh5 trillion infrastructure roadmap outlined by President Ruto to transform the country into a first-world economy and secure its full economic freedom.

“This project will play a role in supporting the economy of Kenya and Kwale County, in particular, by creating 10,000 direct and indirect jobs. This project will also reduce the importation of clinker and make it self-sufficient and a clinker exporter in the near future,” he said. “It is a direct contribution to the Bottom Up Economic Transformation Agenda, particularly the pillars of manufacturing and affordable housing.”

Kenya has in the past heavily relied on imported clinker due to inadequate production capacity, despite having huge limestone deposits. Clinker, a key raw ingredient in cement production, is made of predominantly limestone but also other materials, including iron ore and bauxite. Clinker is then ground and mixed with gypsum and pozzolana to make cement, with clinker accounting for about 70 per cent of the production cost of cement.

The country has, in the recent past, reduced clinker imports due to increased local production, but also higher taxes on imported clinker.

The President pointed out that the country is on track to bring to an end cement imports, saying the country has all the natural resources required to manufacture the product domestically. 

“It is not possible for us to continue importing cement. We have enough limestone and all the materials required for cement production. Why then do we import limestone?” he posed.

“As a government, we recognise that strengthening clinker production capacity is fundamental to securing the cement value chain and safeguarding the long-term competitiveness of the sector.” 

The President also urged private investors to take advantage of the government’s Sh5 trillion infrastructure plan through which he aims to move Kenya to “afirst-world economy.”

He said firms should upgrade their facilities and scale up production to meet what he said is an expected surge in demand of products such as cement and steel, as his plans will convert Kenya into a “big construction site for the next 20 years”.

This is as infrastructure projects start taking shape. The grand infrastructure plan will focus on affordable housing, construction of 50 mega dams for power generation and irrigation, dualisation of 2,300 kilometres of highways and tarmacking of 28,000 kilometres of roads.

“Our national project,” the President explained, “is anchored on strategic infrastructure development, expanded, reliable, and affordable energy, and large-scale irrigation through extensive dam construction designed to unlock productivity in agriculture, manufacturing, housing, transport, and services.”

He noted that more locally-produced cement will be required to meet the needs of the government’s transformative 

The President reiterated the government’s support for private sector investment in public utilities and infrastructure, saying policies are constantly under review to remove all bottlenecks hindering them.