October 30, 2012

Al Amoudi’s Company refuses to pay 200 million Br after acquiring around 80,000tns of coal it had imported

Filed under: Al Amoudi,Midroc — ethiopiantimes @ 11:50 am
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The warehouse that Derba cement stores the coal that it bought from the enterprise.

The Ethiopian Petroleum Enterprise (EPE) is threatening to sue Derba MIDROC cement factory, a new entrant into the industry alleging that it has not paid around 200 million Br after acquiring around 80,000tns of coal it had imported, sources disclosed to Fortune .

The enterprise, which also imports petroleum for nation, claims that its working capital is tied up and hence is eying the court as an alternative means of getting its money back.

The enterprise has been delegated by the Ethiopian government to import coal since December 2011 when the government, decided to replace the Heavy Furnace Oil (HFO), a source of energy that cement factories use to burn the clinker to coal aiming at reducing their production cost and hence make them competitive.

The enterprise thus made a deal with the large-scale factories such as Mossobo, Derba and National Cement factories owned respectively by the Endowment Fund for the Rehabilitation of Tigray (EFFORT), Mohammed Hussien Ali-Al-Amoudi(sheikh) and East Africa Industrial Group as a major shareholder.

Accordingly, based on their reported demand, the EPE inked multimillion dollars contract with Hyton Inc, an international coal supplier company for the supply of 600,000tns of steam coal for these factories in December 2011.

Out of these, Derba which has the capacity to producing 2.5 million tonnes of cement on annual basis has the highest demand and takes the largest share, which is estimated at 50,000tns on a monthly basis.

The EPE so far has imported and distributed 144,000tns of coal to the three factories. However, all did not pay on time. Mossobo and National Cement also owe the enterprise 52 million Br and 30 million Br, respectively, according to sources at the Ministry of Industry (MoI).

Nonetheless, Derba did not effect any payment so far while it has been taking the coal from the enterprise that made it eying the court as alternative to get its money back, according to these sources.

This had drawn the attention of the MoI, which called three cement factories, and the enterprise for a meeting led by Tadesse Haile, state minister for MOI, last week.

Tadesse told Fortune that a consensus has been reached between the factories and the enterprise. “Since the coal is imported to reduce the costs of the factories, they should share a loss in case there is any.”


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