By Silvia Nyambura
Hima Cement has today signed a 5 year Memorandum of Understanding (MOU) with Chinese firm, Guangzhou Dongsong Energy (GZDS) to supply cement and concrete. The Chinese firm which is set to develop phosphate deposits for production of fertilizers as well as steel products is in the first phase of setting up a US$ 620 million operations plant in Eastern Uganda.
Addressing the media in Kampala this morning, Hima Cement CEO Daniel Petterson said, “The purpose of this MOU is to establish the relationship between Hima and GZDS. This cooperation of both parties shall cover the project of construction of the phosphate plant and steel mill plant and any other projects within the Sukulu Industrial Park.”
The parties will execute a definitive sales agreement where will supply the required cement for the project to the tune of over 40,000 tons for the first two years.
“This just the beginning. Going forward we are looking to also collaborate for fuels, provide limestone as well as offtake the slag separated from metals during smelting or refining of ore once GZDS begins production of steel products. Slag is often combined with concrete to form a more blended cement,” he added.
The Sukulu Phosphate Project located in Tororo district in Eastern Uganda will manufacture key products such as phosphate fertilizers, steel products, rare earth minerals and generate electricity with the capacity of 12 megawatts. It is expected to start production in December 2016 and will employ more than 1,200 Ugandans.
Commenting on this partnership, the General Manager of GZDS, Zheng Xu said the MOU opens up opportunities for a mutually beneficial engagement, creating long term benefits for both parties.
“We signed a mineral development agreement in 2014 having finished exploration, acquired a mining lease and received approval from the National Environmental Management Authority (NEMA). We have a 99 year lease on 334 acres for mining and 600 acres for the commercial plant. Now that we are in the process of constructing the plant, this MOU will be mutually beneficial to us and Hima Cement,” Xu said.