Moroccan fertilizer company eyes USD 500 mln investment here
The Morocco-based OCP Group, which specializes in fertilizer manufacturing, is conducting talks with Ethiopian authorities to set up a manufacturing plant in Ethiopia at a cost of half a billion dollars.
OCB Group is considering Ethiopia as an option in Africa taking into account the country’s gas resource and potential. Tarik Choho, chairman of OCP Group, told The Reporter during an event held in Marrakesh, Morocco from February 25-26 that OCP has been conducting feasibility studies and had identified which types of fertilizers it plans manufacture in Ethiopia depending on the soil type.
Hence, the company will plant a urea and potash processing factory and if things turn out as expected the plant will require some 530 million dollars, Choho said. A similar plant has been recently built and inaugurated in Morocco that has required the same amount of money, he said.
The recent gas pipelines Ethiopia is planning to construct has paved the way for OCP Group to consider setting up a plant. Gas being a major input to manufacture fertilizer, however, is to be well explored on how much volume the country can avail for the OCP Group. Adeline Fabre, vice president of OCP Africa – a newly set up subsidiary under the group told The Reporter that the selling price of gas together with the supply volume needs to be evaluated.
In addition to that, Ethiopia is preparing to mine and export potash, which the fertilizer manufacturer said is another advantage. The plant, which will be erected in Ethiopia will be manufacturing fertilizer from Nitrogen, Potassium and Phosphorus. In addition to availing gas resources, Ethiopia needs to provide potential amount of potash mineral in order to have a fertilizer plant, which will process similar amounts in Morocco.
The chairman said that discussions are well under way but pacing the time is what he needs to see from the Ethiopian side. Currently, a task force is to be set up to look into the prospects of how the fertilizer business can be implemented in Ethiopia. The OCP Group said that it has the availability of skills, know-hows, design and engineering teams in place. According to Choho, Ethiopia needs to determine the ample availability of gas and potash resources to realize the project.
Imane Belrhiti, vice president of sales for Africa at OCP Group, also told The Reporterthat OCP Group has been supplying Ethiopia for some time now. Through a bid process, OCP has maintained to procure and supply some 70 to 80 percent of the total amount of fertilizer Ethiopia imports. As a major buyer, Ethiopia stands top in Africa for OCP. The group has set up an office in Addis Ababa, Belrhiti said.
A delegation led by Alemu Sime (PhD), state minister of the Industry, visited the headquarters and the major manufacturing plant of OCP Group in Marrakesh. Officials of the Agricultural Transformation Agency (ATA) showcased Ethiopia’s endeavor on analyzing and mapping the soil types and nature which require specific type of fertilizers. ATA also publicized the functioning of fertilizer blending plants in Ethiopia owned by cooperatives. Daniel Gad, founder and owner of Omega Farm in Ethiopia, was also part of the conference to showcase agro processing trends.
OCP Group is able to manufacture some 27.4mt tons of various types of fertilizers and export to countries such as Ethiopia. According to OCP Group, Ethiopia is the largest single buyer of fertilizer from the group. In addition to that, reports suggest that Ethiopia is the largest consumer in Africa next to South Africa and Nigeria.
OCP Group shares 27 percent of the global fertilizer business, mainly of phosphate, and generates some 4.9 billion dollars and employs some 21,000 across the board.