Arabian Cement files lawsuit against Emaar EC to claim remaining quantities of limestone

Logo of Arabian Cement Co.

Arabian Cement Co. filed a lawsuit against Emaar the Economic City (Emaar EC) before Jeddah Commercial Court to claim the remaining quantities of limestone ore in accordance with the agreement signed between them on April 28, 2012, the company said in a bourse filing today, Sept. 21.

The move pertains to the final settlement with Emaar EC on the overlap of the lands plots owned by Emaar EC with the concession lands plots granted to Arabian Cement.

During the six-year agreement, which ended on April 28, 2018, Emaar EC supplied Arabian Cement with 44.7 million tons of limestone.

The remaining 5.3 million tons were not received by Arabian Cement, as Emaar EC refused to provide the quantity due to the expiry of the agreement period, as per their official response.

This was despite repeated correspondences and meetings with Emaar EC’s current and former management over three years without any progress.

Accordingly, Arabian Cement decided to proceed with the legal action to preserve its rights and to claim the remaining quantities estimated at 5.3 million tons, or to return part of the lands plots that it had previously ceded to Emaar EC in exchange for providing it with a quantity of 50 million tons of limestone suitable for cement manufacturing from dredging of King Abdullah Port.

The cement producer said that it was not possible to currently determine the financial impact of this case. At present, there are no major legal, regulatory, or operational risks or consequences that may arise from the case.

Any new development will be disclosed in due course.

According to the available information, the company obtained legal advice to claim the rest of the amount and notified Emaar EC of its intention to resort to the legal action in a letter dated Sept. 1, 2021, to which it has not received any response to date.

Arabian Cement does not expect to bear any liability as a result of filing a lawsuit, the statement noted.

According to data compiled by Argaam, Arabian Cement and Emaar EC reached a final settlement on April 28, 2012, regarding the dispute that existed between the two firms related to the overlapping of lands plots owned by Emaar EC, with an area of 3.66 million square meters, with the concession lands granted to Arabian Cement. 

Under the settlement, Emaar EC was committed to provide, free of charge, 50 million tons of limestone needed for the cement company’s manufacture from the dredging output extracted from the construction of the King Abdullah Economic City port, after obtaining the necessary mining license from the Ministry of Petroleum and Mineral Resources. 

In return, Arabian Cement was committed to deliver Emaar EC the lands plots owned by it under the above settlement and overlapping in the Arabian Cement’s concession land plots.