Northern Cement cancels deal with KHD for Iraq project, contracts with another entity

30/05/2024 Argaam
Logo ofNorthern Region Cement Co.

Logo of Northern Region Cement Co.

Northern Region Cement Co. will not activate the contract formerly sealed with German company KHD Humboldt Wedag International Co. due to disagreement on payment terms, according to a Tadawul statement today, May 30.

 

The company had signed a contract on Nov. 5, 2023, with KHD to construct a production line with an annual capacity of 1.32 million tons of cement in Iraq, valued at $139 million.

 

Instead, Northern Cement confirmed today awarding the project to China’s Sinoma Overseas Development Co. The 18-month construction project is valued at $188 million (SAR 705 million), entailing deferred payment terms of 12 years from the start of operation and production.

 

The company stated the delay from the previously announced date was due to negotiations on payment terms.

 

The relevant financial impact, which will be announced later by the cement producer, has been deferred to the first quarter of 2026. Northern Cement will also reveal any related developments in due course.

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