Lafarge Signs Strategic Cooperation Agreement with Government
of Yunnan Province, China, to boost its expansion in a fast growing market
Lafarge has signed today with the People's Government of Yunnan Province a strategic cooperation agreement concerning the further modernization and restructuring of the building materials industry in the fast developing province of Yunnan, China. The agreement focuses on cement, ready-mix concrete, aggregates and plasterboard. It will involve the construction of at least an additional 10 million tons of new cement capacity by 2010 by Lafarge Shui On, plus brand new plants in plasterboard and ready-mix concrete, as well as aggregate quarries.
As a strategic partner, Lafarge will assist the Yunnan Government in accelerating the modernization of the cement industry, promoting energy-saving policies, developing the use of waste as alternative fuel and developing new quality products in all the product lines covered by the agreement.
The agreement represents a total investment of approximately 600 Million USD in state of the art, low cost and highly efficient industrial facilities.
Overall, taking into account the capacity expansion programme currently underway in the four provinces of South West China -Yunnan, Guizhou, Sichuan and Chongqing-, Lafarge Shui On should bring its total cement production capacity in China from 20 million tonnes at the end of 2006 to 50 million tonnes in 2012.
Mr. Qin Guangrong, Governor of Yunnan Province, and Mr. Bruno Lafont, Chairman and CEO of Lafarge Group, were present at the signing ceremony in Kunming, Yunnan.
At the ceremony, Governor Qin Guangrong said: "With the increasing demand in the local cement market, the building materials industry of Yunnan Province is forecast to grow rapidly in the coming years. In line with the 11th 5-year plan of Yunnan Province, we are aiming at modernizing rapidly the construction materials industry in Yunnan. I believe that involving Lafarge, the world leader in building materials, which will be able to bring its management and technological expertise to the future plants in Yunnan, will help our Province to move faster to more modern and energy efficient technology."
Bruno Lafont, the Chairman and CEO of Lafarge Group, declared: "This agreement is a milestone for Lafarge in China. It is an opportunity for Lafarge to strengthen its business in the Yunnan Province, where we are already present. Lafarge is honored to have this win-win cooperation with Yunnan. All of our operations in the Yunnan Province will adhere strictly to Lafarge environmental standards in terms of emissions reductions, waste heat recovery for power generation and quarry rehabilitation. Lafarge will also take the lead in the Yunnan Province in promoting safety and it will invest in recruiting and training local talents.
We are determined to step up the pace of our development in China. The Chinese markets in which we operate are enjoying sustainable growth and we believe timing is optimal to build upon our investment in China since 1994, as well as our in-depth cooperation with the Chinese authorities."
Notes to editors
About Lafarge Group
Lafarge is the world leader in building materials, with top-ranking positions in all of its businesses: Cement, Aggregates & Concrete and Gypsum. With 71,000 employees in over 70 countries, Lafarge posted sales of Euros 17 billion and net income of Euros 1.4 billion in 2006.
Lafarge is the only company in the construction materials sector to be listed in the 2007 "100 Global Most Sustainable Corporations in the World". Lafarge has been committed to sustainable development for many years, pursuing a strategy that combines industrial know-how with performance, value creation, respect for employees and local cultures, environmental protection and the conservation of natural resources and energy. To make advances in building materials, Lafarge places the customer at the heart of its concerns. It offers the construction industry and the general public innovative solutions bringing greater safety, comfort and quality to their everyday surroundings.
About Lafarge in China
Lafarge entered the Chinese market in 1994 and is now present in all of its businesses - Cement, Aggregates & Concrete and Gypsum - with about 16,000 employees.
In 2005, Lafarge signed a joint venture partnership with Shui On Construction and Materials Ltd. to create Lafarge Shui On Cement. This joint venture is the Cement market leader in south-west China, with 24 million tons of capacity at the end of 2007.
In Gypsum, Lafarge is present through Lafarge Boral Gypsum in Asia (LBGA), a 50-50 joint venture between Boral Ltd and Lafarge. Since its creation in June 2000, LBGA has established itself as the leading supplier of plasterboard products and systems in Asia. LBGA has three manufacturing plants in China, two in Shanghai, one in Chongqing, for a total annual capacity of about 50 million m². A new 10 million m² plasterboard factory is currently under construction in Chengdu, Sichuan province.