State-owned Vietnam National Cement Trading Corporation has placed an order with F.L.Smidth via its import/export company, VINACIMEX, for a complete production line at a total value of nearly 100m euros.
------------------
Won against international competition, notably from a German contender, the contract marks the culmination of a long negotiation process that began in the autumn of 1998. The contract is included in F.L.Smidth's order forecast for 2001 and the main sources of finance are Danish export credits with repayment guaranteed by Vietnam's Ministry of Finance.
The order becomes effective once F.L.Smidth receives the first instalment which is expected around New Year. A minor portion of the contract value will be recognised as income in 2002, while more than half of the sum will be recognised during 2003 in step with equipment deliveries, the balance being taken to income in 2004 and in connection with commissioning in the first half of 2005.
The contract comprises machinery and equipment, spare parts, civil construction drawings, struc-tural steel, supervision and training. Several FLS companies are expected to enter into subcontracts with F.L.Smidth.
Situated just north of the port of Haiphong, some 110 km east of the Vietnamese capital of Hanoi, the production line will have a capacity of 3,300 tonnes cement clinker per 24 hours, equivalent to about one million tonnes per year. The cement plant replaces the customer's existing and envi-ronmentally unsustainable facility in Haiphong and will be fuelled by locally-sourced anthracite coal which has a very low gas content. The new plant will comply with the most exacting international environmental and energy standards.
Vietnam has an annual cement production of 13 to 14 million tonnes, which is sufficient to cover domestic consumption. According to Vietnamese sources, cement usage is expected to grow at an annual rate of 10 - 12 per cent, which means that 2005 is likely to see a total demand of nearly 20 million tonnes of cement.
In 1976, F.L.Smidth received a contract for the nation's first dry-process plant, awarded by Viet-nam National Cement Trading Corp. The initial production line at the Hoang Thach plant was fol-lowed by a second line commisioned around mid 1995. The plant's total output is now about two million tonnes cement per year or 6,500 tonnes per day.
F.L.Smidth is also just now building a facility for Ninh Binh Cement Company in Vietnam - a project that is expected to be finished by the end of 2003.
FLS Industries A/S
Corporate Public Relations