Saudi Arabia's Jizan cement plant still in limbo

10 March 2010

Saudi government yet to allocate site to Gazan Agricultural Development

Plans to build a cement plant 70km from the city of Jizan in the south west of Saudi Arabia are still on hold because no site has being allocated by the Saudi government, a source tells MEED.

The source says the plant, being developed by Gazan Agricultural Development (Gazan), was still waiting for a site and that no timeframe for allocation had been given by Riyadh.

“Gazan is still waiting to hear back from the government,” the source says. “As soon as [the company] is given a site, it will carry out studies and evaluations and hopefully start work. The first phase of the site will have a capacity of 1.2 million tonnes a year (t/y).”  

The Jizan province is close to the Yemen border and is one of the most impoverished regions in the kingdom.

When asked whether the current export ban on cement was also affecting the decision to build the plant, the source says: “No, there is no relation between the export ban and the fact the project is on hold.”

However, despite the export ban on cement not affecting the proposed facility, there are concerns that imports into the kingdom are affecting the industry. “The [Saudi] market is flooded [with cement] at the moment and the price is far lower than international prices,” he said. “In Saudi, the price is about SR250 ($67) a tonne, while prices in Jordan and Egypt are about $100 a tonne.”

The export ban on cement and clinker has been in effect since June 2008. The only country eligible for restricted cement exports from the kingdom is Bahrain.

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