Lafarge Africa to run its plants on renewable energy within 5 years


Nigeria’s second largest cement producer, Lafarge Africa is making efforts to run its plants on renewable energy in the next 5 years. Legal director of the company, Mrs Edith Onwuchekwa stated this during a tour of its Calabar factory by shareholders and investment analysts. She said the move was as a result of frequent disruptions in its gas supply due to militant attacks in the Niger Delta.

The switch to renewable energy however is part of a larger one by its parent company Lafarge Holcim and other global players. Lafarge Holcim in its sustainability report set a target of producing 50% of the energy required to run its plants from non fossil fuels by 2020. 30% of this proportion will be from bio mass. Lafarge Holcim is currently building a solar energy plant for its Rashadiya operations in Jordan. Cemex, a cement producer runs one of its cement plants in the Dominican republic on solar energy. Dalmia cement factory in India, also runs part of its operations using solar energy.

For the Calabar factory, the biomass will be sourced from palm kernels. Cross River is one of the 24 states in Nigeria where palm oil is farmed. Using biomass as a backup benefits not only the company, but owners of palm oil plantations that will supply the palm kernel. Additional staff may be employed for the processing of the palm oil. If the company is able to get the kernel in sufficient quantity and prices, it could decide to use biomass as its main source of energy. That will result in reduced cost, which translates to more profit.

Lafarge recently got approval from its shareholders to embark on a N140 billion rights issue. Proceeds of the offer will be used to pay down the company’s dollar denominated debt. The parent company’s share of the offer will be paid by converting its existing debt into equity. Shares of the company are up 28.82% year to date on the Nigerian Stock Exchange (NSE).

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