Plans are moving quickly to increase the country's cement capacity, with contractors close to being appointed on the expansion of two state-owned cement plants and two private sector projects recently launched.

Five companies are understood to have submitted technical and financial bids for the estimated $100 million contract to expand production at the Bajil cement plant. An award is expected in early 2005 by the client, the state-owned General Cement Authority. The project calls for raising capacity at the plant to 800,000 tonnes a year (t/y) from 600,000 t/y. The UK's Cement Consultancy Associatesis the consultant.

Tender documents are also being prepared for the upgrade of the Barah cement plant, which would increase capacity by about 25 per cent to 750,000 t/y. An expansion is already under way at the government's third plant, at Amran, to add 1 million t/y of clinker capacity and to double capacity of the existing line to about 600,000 t/y (MEED 5:4:02).

A local/Saudi joint venture, including the Eastern Province Cement Companyand Saudi Binladin Group,has been established to construct a cement plant in Mukalla, in the Hadramout governorate. The facility will have capacity of about 1.2 million t/y and project costs are estimated at $260 million.

A second, $150 million plant with capacity of about 1 million t/y is planned at Batis in Abyan governorate by another local/Saudi consortium, including the local Hayel Saeed Group.

Trade & Industry Minister Khaled Rajeh Sheikh said in early November that the government was aiming to boost cement production to 5.5 million t/y by 2007, from about 1.5 million t/y today, through public and private investment of about $700 million.