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State-owned Bangladesh Chemical Industries Corp (BCIC) has threatened to withdraw from a Saudi-Bangladesh joint venture under which a cement factory is to be built in Sylhet’s Chhatak borough, Bangladesh.
In a recent letter to the Ministry of Industries, BCIC has sought the pull out of the joint venture as it found irregularities, cost escalation and anomalies by their counterpart.
The deal for the joint venture between the two countries was signed during Prime Minister Sheikh Hasina’s Saudi Arabia visit in 2018. According to the agreement, the manufacturing unit will have a capacity of 12,000tpd of clinker and 3000tpd of cement. According to the primary estimation, the US$321m Saudi Bangla Integrated Cement Co Ltd joint venture was to incorporate 40 per cent Bangladeshi and 60 per cent Saudi investment.
The chemical corporation complaints are primarily against three Bangladeshi directors, reports TBS News. In a letter to the industries ministry, the state-owned corporation mentioned that the three Bangladeshi citizens are also on the board of directors of the local engineering and construction firm Dipon Group.
Moreover, the initial feasibility study for the cement manufacturing project estimated the cost at US$321m. However, a subsequent study recommended increasing the cost to US$604m, drawing objections from the company’s board.
The revised feasibility report also showed a cost of US$117m for a 18km-long conveyor belt to transport materials to the cement plant despite the first study estimating the cost at US$49.8m. No drawings, designs, or cost estimates were provided for the belt in the report.
Published under Cement News
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