Sri Lanka Hambantota Magampura Port Attracts Vehicle Assembly and Cement Manufacture

22nd October 2010, www.lankabusinessonline.com

A new port being built in Sri Lanka's southern Hambantota has drawn investment proposals from local and foreign businesses including the local Senok Combine and Micro Car for vehicle assembly, officials said.

Madras Cements, India's fifth largest cement maker and part of Chennai-based Ramco Group, has also proposed investing in a cement terminal at the port, a greenfield site to be operated as a free port with no taxes.

A Sri Lanka Ports Authority statement said that 27 local and foreign companies among 63 that collected the request for investment proposals have submitted bids.

"The response shows investors are keen to invest in the new port," said Agil Hewageegana, SLPA chief engineer in charge of the port project in Hambantota known as Magampura Port.

He said some of the local firms that sent proposals are in joint ventures with foreign partners.

The new deep water harbour close to the main shipping route across the Indian Ocean, to function initially as an industrial port, was built by Chinese firms and largely funded by Chinese loans.

The SLPA received six investment proposals for cement terminals in Hambanthota when bids closed last week, two for vehicle assembly, two each for liquid petroleum gas and petro-chemical complexes, and three for warehousing.

Investors have also bid to set up a sugar refinery and a fertilizer plant.

The two local firms interested in vehicle assembly are Senok Trade Combine, agents for vehicle manufacturers like Audi, Subaru and Skoda, Transmec Engineering, which assembles the 'Micro Car' in Sri Lanka.

Pakistan's Jamshoro, based in Lahore, which had bid for part of the Shell Gas assets in that country has submitted a proposal for an LPG terminal.

Proposals petro-chemicals investments have come from a Singapore firm and Advance Surfactants Lanka, which makes industrial chemicals.

The SLPA said a total land area of 2,000 hectares belonging to the Magampura Port will be available for local and international entrepreneurs.

"Magampura Port is being developed as a multi-purpose, industrial and service port and aims to make the best of the expanding markets of the Indian sub-continent, with short transit times to India, Africa and the Gulf region," it said.

The government plans to start phase two of the project during the last quarter of this year with the contract agreement recently signed between China Harbour Engineering Company and SLPA.

The financial assistance would be extended by the the People's Republic of China on a concessionary basis, the statement said.

The second phase will expand and deepen the harbour, adding more berths and cranes to handle containers.

Sri Lanka Cement Demand to Grow 7pct in 2010

16th June 2010, www.lankabusinessonline.com

Sri Lanka's cement demand is expected to grow between 6.0 and 7.0 percent in 2010 driven by reconstruction demand from former war-torn areas, a top Sri Lankan cement maker said.

"There is an increased demand from all areas of the country," Manilal Fernando, chairman of the Sri Lanka unit of Holcim, a Swiss-based firm said.

"We feel that coupled with the increase in reconstruction in the North and the East cement demand will grow by 6.0 to 7.0 percent this year."

Holcim is the island's only integrated cement maker, which produces cement from limestone and it also has a grinding plant.

Tokyo Cement, a listed group operates several grinding plants.

A war in Sri Lanka's north east ended in May 2009, along with a balance of payments crisis, and interest rates have come down with the monetary authority ending contradictory policy.

Lower interest rates have also paved the way for a recovery in a burst housing bubble.

Official data showed that the cement market was growing by double digits in 2010.
Data released by the Central Bank showed that in the first quarter of 2010 local cement production grew 10.6 percent to 417,000 metric tonnes and imports grew 12.5 percent to 486,000 metric tonnes from a year earlier.

In March local production grew 5.1 percent to 143,000 metric tonnes, and import grew 9.4 percent to 326,000 tonnes from a year earlier.

Sri Lanka's Largest Cement Silo Project Underway at an Investment of $ 100mn

January 24th 2010, www.sundaytimes.lk

A US $100 million project to produce the largest ever cement silos in the country commenced early this month in Colombo, according to officials.

“About two weeks ago the construction of the plant at D.R. Wijewardena Mawatha, in Colombo for the joint venture between Lanka Cement Ltd. (LCL) and the UK based AML products Ltd began,” Sisira Paranagama, Chairman LCL told the Business Times.

He noted that production in this plant which is on a one acre land will commence by the end of the year, while the expected output for a month is 10,000 metric tones of silos. “This is only for the first stage. We plan to enhance the capacity in the medium term,” he added. Mr. Paranagama noted that the silos will especially be used for Uthuru Wasanthaya - the Northern development programme which aims to develop the North and the East.

“Road development, canals and bridge building will be concentrated at first (in the Northern development) with the initial production from this plant,” he said, explaining that this project will facilitate a large cost savings to businessmen in Colombo and the North.

“This is mainly because we can price this product at a concessionary rate. We will decide the price when the production begins, depending on the macro situation at the time, but it will be priced at a lower rate than the price (at the time),” he said.

Sri Lanka Holcim to Bid for Jaffna Cement Plant Tomorrow

05th November 2009, www.lankabusinessonline.com, By Jayantha Kovilagodage

The Sri Lanka unit of Swiss-based Holcim to bid for Jaffna cement plant tomorrow Nov 05, 2009. Holcim said it would enter the bidding process to build a joint venture cement plant with state-run Sri Lanka Cement Corporation in the northern Jaffna peninsular.

Holcim Sri Lanka chairman Manilal Fernando said in a telephone interview from Dubai that firm's board of directors had cleared the move and a proposal would be submitted to the government tomorrow.

Sri Lanka's Jaffna peninsular has large deposits of high quality limestone.

Last month, the island's ministry of industries called for expressions of interest to build a cement plant with 1.6 million tonnes a year capacity with the government holding a 51 percent stake.

The plant was destroyed during a 30-year war with Tamil Tiger separatists that ended in May.

There is also another plant, which is partially intact in the peninsular belonging to Lanka Cement, a listed state-run firm.

Holcim owns Sri Lanka's only integrated cement making plant in the northwest Puttalam area and also operates a grinding plant in Galle, in the south of the country.