The Minister of Works, Dr. Dave Umahi, has emphasized the importance of revitalizing Nigeria’s refineries and supporting the Dangote Refinery to help lower cement prices, which would significantly benefit the construction sector.
Speaking at the 2024 Engineering Conference and Awards Dinner organized by the Nigeria Society of Engineers (NSE) Bwari Branch in Abuja, Dr. Umahi highlighted the critical role that cement plays in construction and how its current high cost, driven by inflation and energy expenses, is impacting the industry.
In his address, titled “The Cement Conundrum: Impacts of Inflation, Energy Costs, and Cement Prices on Rigid Pavement in Nigeria,” Dr. Umahi explained that producing a tonne of cement requires approximately 105 kWh of electricity. This energy consumption accounts for about 40-50 percent of the total production cost, making cement prices highly sensitive to fluctuations in energy costs.
Represented by Dr. Halimat Adediran, the immediate past chairman of the NSE Bwari branch, Dr. Umahi proposed several strategies to address the high cost of cement. These measures include:
Stabilizing the Foreign Exchange Rate: Ensuring a stable exchange rate to reduce the cost of imported raw materials and equipment used in cement production.
Granting Waivers to Manufacturers: Providing financial incentives, such as tax breaks or import duty waivers, to cement manufacturers to lower production costs.
Establishing Compressed Natural Gas (CNG) Plants: Encouraging the development of CNG plants to provide a more cost-effective and sustainable energy source for cement production.
Encouraging Manufacturers to Set Up Power Plants: Supporting cement manufacturers in establishing their own power plants to reduce reliance on the national grid and control energy costs.
Dr. Umahi’s remarks underscore the need for a multifaceted approach to reducing cement prices, which includes enhancing energy efficiency, stabilizing the economic environment, and supporting key infrastructure projects like the Dangote Refinery. These initiatives are expected to not only lower the cost of cement but also strengthen the overall construction industry in Nigeria.
