MARKETS

Coal's price tag too big for South Valley

The $US19.8 million ($A21.1 million) proposed bill to use coal as an energy source has proven too costly for South Valley Cement Company, which says it will opt for the cheaper mazut to power its expanding cement factories.

Sadie Davidson
Coal's price tag too big for South Valley

SVCC said it would be indifferent if the Egyptian government decided not to follow through with the coal usage plan because it could rely on mazut, a low-quality fuel oil, in addition to gas, in order to produce cement.

It did say that the availability and sustainability of the alternative energy sources remains a big challenge.

The company said that only coal could ensure the company reached 100% of its production targets, but it would be forced to use the less efficient mazut or agricultural waste to reduce costs.

SVCC officials said that its application for alternative energy sources, suggested by the Egyptian government, could take up to 12 months to be approved.

The company is seeking to double its production capacity and is currently constructing two new cement plants, which are expected to be complete within 17 months

The company plans to increase its production capacity to reach 3.75 million tonnes a year by 2017.

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