Egypt: energy shortage stops cement factories

A shortage of natural gas caused four plants belonging to Misr Beni Suef Cement Company to suspend operations for the second time in the last two months. The stoppage has uncured losses of EGP100m and threatens the redundancy of 7000 workers at the factories that produce up to 40,000tpd of cement.

“The company has put in a request to President Mohammed Morsy to end the gas shortages, however it has not received a response,” said Farouk Mustafa, Misr Beni Suef Cement Company's managing director.

He added that the company has been unable to import additional natural gas as a result of the country’s lack of a strong logistical infrastructure needed to transport energy from Egypt’s ports to its factories.

“The company consumes half a million cubic metres of natural gas a day, a large amount whose shortfalls would need to be compensated for by purchases made from the local market,” Mustafa continued.

Many companies in the area are still feeling the effects of the rise in natural gas prices, which has led to a decrease in the amount of Egypt’s cement exports, as a rising cost of production has made it hard for these companies to compete on the world market.

“We will conduct meetings with the minister of petroleum and president of the province’s Gas Holding Company in order to solve the problem of energy shortages which have led to the closure of several factories including Misr Beni Suef Cement Compay and South Valley,” said the Governor of Beni Suef, Maher Baybers.

Southern Valley Cement, Misr Beni Suef Cement and Delta Cement factories have all shut down their operations, while the Ghiyada cement factory has only been using one of its production lines. Other factories in the region have given their workers a week off after the sudden cut in local energy supplies.