Kampala. Government will construct a cement plant in Karamoja sub-region through a public-private partnership with Moroto Ateker Cement Co Limited.
The company is a formation of Uganda Development Corporation (UDC) and Savannah Mines, a local firm based in Karamoja, with a shareholding of 51 per cent and 49 per cent, respectively.
The partnership and eventual production of cement will not only cut back on the country’s import bill, but also reduce on cement demand in the country.
According to Uganda Bureau of Statistics, cement production in the country has decreased by 14.7 per cent. This has led to higher prices of the commodity due to high demand.
Motor Aterer has also contracted Saboo Technologies, an India Company, to construct the cement plant in Moroto Industrial Park.
Saboo directors have done a feasibility study on the project to establish the costs, duration and raw materials that will be used among other things.
Mr Anuarg, the Saboo director- Saboo Technologies , said the plant will be done in two phases.
According to the feasibility study, the project is expected to cost $225 million (Shs765 billion). Of this, about $200 million (Shs680 billion) will be spent on plant and machinery and operational costs will take $25 million (Shs85 billion).
Mr Fred Ogene, UDC’s acting executive director, said they use the mining licence of Savannah Mines through the PPP arrangement.
“We are zeroing on Saboo because they have a reputation in the construction of cement plants globally since they have done some work in Ethiopia and Djibouti,” Mr Ogene said.
Saboo and Moroto Ateker are expected to sign a Memorandum of Understanding before works kick off.
But the Finance ministry is obliged, through a sovereign guarantee, to show that both parties will repay the loan when commercial production starts.
“The only delay we expect is the process of getting a guarantee because the ministry of Finance has to go through Cabinet and Parliament who will have to approve the project,” Mr Ogene said.