NCC energy supply from car tyres

[sharewadi]

Not often you see news for NCC, so thought it was worth adding .

Some of the other cement companies might be interested - their profits are suffering due to rising energy costs. RAK Cement (RAKCC) is a name that springs to mind with soaring energy costs in 2007 Q3.

With an estimated 50 million tyres lying around the UAE, and burn rate of about 2000 tyres per day for NCC, that means there's potentially almost 70 years worth of supply there .

NCC shares fell 0.9% to 11.20 dhs from negligible volumes on Thursday. Their shares trade most days but very low volumes.

Haven't seen 2007 FY results yet but NCC 2007 Q3 report and M9 report shows falling profits, PE of about 16-17 which is in line with market average, and a relatively low PBV of 1.4.

Khaleej Times 31 January 2008:

Car tyres drive energy for cement unit Zoe Sinclair (Staff Reporter) 31 January 2008 DUBAI - The National Cement Company (NCC) has achieved a regional first by using old car tyres to generate energy for cement production, thus cutting fuel costs and helping the environment. Chief Electrical Engineer Magdy Mohammed Helal said the tyres were burnt to help generate the 900-degree celsius heat needed in the chemical process. ‘We can use all heavy plastics, tyres, hydraulic hoses, water pipes,’ Helal said. ‘It generates energy similar to that produced by oil.’ At this stage, however, the tyres only supplement oil, comprising 10 per cent of the fuel. Helal explained large quantities of the raw material generated excessive gases which upset the chemical balance. But as technology improves he expects more tyres could be used. Most harmful emissions are eliminated during the process, keeping the factory’s emission levels well below a third of the allowable limit. ‘Using the tyres does not harm the environment,’ he said. The National Cement Co. already has a greater supply of tyres than it requires. ‘Originally we were paying for the tyres but now we don’t because we have too many people coming,’ Helal said. The company had been aware of the technology for about five years when the first factories began implementing the technology in Europe. It was only when the company had a higher capacity, about one year ago, that the process was introduced. ‘This is the first factory in the UAE and probably the Middle East using tyres to generate energy,’ he said. The factory uses between 1,800 to 2,200 tyres per day or between one and one and a half tonnes per hour. In a related development, Bee’ah, the environmental solutions company in Sharjah, has plans to develop tyre-recycling facilities this year, but the tyres will not be used to generate energy. Bee’ah Managing Director Samer Kamal said the UAE had one of the highest numbers of cars per capita in the world and there were an estimated 50 million tyres lying in landfills in the country.

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