(Yicai) Aug. 4 -- China’s Sinoma International Engineering has signed a USD476 million contract to supply equipment for two cement clinker production lines of Nigerian industrial conglomerate Dangote Industries’ plant in Itori.

Sinoma will provide complete sets of production gear and engineering materials for the third and fourth production lines at the factory of Dangote’s unit Itori Cement, the Beijing-based firm announced yesterday. The deal also includes a 12-month equipment warranty after the production lines reach target output of 6,000 tons a day each.

Clinker production is expected to commence 24 months after work to install and commission the equipment kicks off, while cement output will begin a month after that, Sinoma noted, adding that deliveries will be arranged according to the project timeline and governed by CIF Lagos Port or CIP Murtala Muhammed International Airport terms.

Sinoma’s shares [SHA: 600970] closed 2.6 percent down at CNY7.90 (USD1.16) each in Shanghai today. They have risen nearly 11 percent since the beginning of last month.

Dangote said it had signed an USD800 million memorandum of understanding with Sinoma on Aug. 1 to expand the Itori plant, aiming to roughly double its production capacity to 12 million metric tons a year to strengthen Nigeria’s position as a major cement export hub.

Under the agreement, the project will enable Dangote to further meet increasing demand in Nigeria while substantially strengthening its export capacity.

The two parties have a long-standing partnership. In January 2023, Sinoma was general contractor for the first and second production lines of the Itori project, with each boasting a clinker capacity of 6,000 tons per day. That deal was worth USD585 million -- USD531 million for equipment and USD54.5 million for installation and commissioning.

Beset by land expropriation and policy-related delays, that project remains in the final phase of equipment debugging and is expected to come on stream by the end of the year.

Sinoma had revenue of CNY29.2 billion (USD4.3 billion) from engineering technology services last year, accounting for about 59 percent of the company’s entire income. Just over 55 percent of its revenue came from overseas markets.

Editor: Futura Costaglione