Luxembourg firm to build Sh500m bitumen plant in Kwale

Bitumen use at a construction site.
Global bitumen market size is poised to exceed $110 billion by 2024.
Luxembourg-based bitumen dealer West European Group is setting up a bitumen manufacturing plant in Shimoni, Kwale County, in a move that could potentially make Kenya a net exporter of the road construction material.

West European Group says it will spend about Sh500,000 to set up the factory that will be operational within five to seven years.

“Kenya’s bitumen demand is about 100,000 tonnes, all of which is imported. The plant will have an annual capacity of 280,000 tonnes, turning the country into a net exporter of bitumen,” said West European Group CEO Ali Paramani.

He said the company will employ new technology to manufacture ‘green bitumen’, which is eco-friendly unlike the material used in most sites across the country.

“The construction material is inflammable and it is not poisonous like the one being used currently. Referred to as green bitumen, it is the one recommended for construction of roads because it is not harmful to the environment,” he said.

Considering that Kenya is a net importer of bitumen, local manufacturing of the material could potentially slash the costs of road construction by 10 per cent, according to Mr Paramani.

Used as a binder in road-building products, bitumen is a very viscous black or dark brown material made from the by-products of refined crude.

READ: Nairobi-Mombasa highway expansion begins 2018 with a Sh230bn price tag

Once fuels, motor oils and solvents have been extracted from the crude oil, a tar mixture is left out. The mixture consists of residential hydrocarbons and a high concentration of bitumen.

The solution is refined further to make road construction bitumen and other compounds used for construction materials like roof shingles, flashing, and sealants.

Global bitumen market size is poised to exceed $110 billion by 2024. This growth is driven by several factors such as the rising use in building of roads around the world and the rapid urbanization in the developing markets.

The market, however, faces certain shortcomings that include high degree of environmental hazards created by bitumen and the volatility in raw materials prices, which may undermine growth of the sector.

The global market for bitumen is dominated by large multinationals such as ExxonMobil, Valero Energy Corp., Shell Bitumen, Nysas AB, Indian Oil Corp., Chevron Texaco Corp., and NuStar Energy.