Sinai Cement Company (SCC) has contracted engineering company FLSmidth to provide the equipment for it to start working using coal, the company revealed this week.

The cement manufacturer added it would also partner with local contractors and suppliers to equip the factory to use coal as an alternative energy to natural gas and Mazut fuel oil.

The industrial sector, represented by the Federation of Egyptian Industries, has shown signs of accepting recent increases in automotive petroleum products prices, including fuel, diesel and natural gas. The sector said it will bear the cost of the energy price increases taking into account the current economic situation “that doesn t allow for any alternative”.

Following the fuel price hike announcement, the government has raised gas prices for cement factories to USD 8 per million British Thermal Units (BTUs) compared to USD 6 previously. The price of fuel oil increased from EGP 1,500 to EGP 2,250 per tonne.

Despite the Ministry of Environment s opposition, the interim government approved in April the industrial use of coal as an alternative energy source. The move came to address the energy shortage, pending the endorsement of the Environmental Impact Assessment.

After issuing the decision, the government said it would impose a tax on coal usage and work on amending laws tightening penalties for violating environmental standards and regulations.

Minister of Industry Mounir Fakhry Abdel Nour said importing coal would not start until the environmental standards and regulations for the industrial use of coal have been finalised and ratified.

However, cement factories have already started taking steps towards this. In a bid to shift to coal usage, the Arabian Cement Company commenced testing coal in June in thermal power generation. It aims to shift to this energy source for 50 per cent of its factories needs.

Suez Cement Company also announced plans on Sunday to invest EGP 300 million to convert two of its four plants to use coal. The conversion process for each plant will cost around EGP 150 million.