NMC steeling the vision 2030 flagships projects

Last Updated 15 years ago by Kenya Engineer

By
Eng. George onyango
Managing director of Numerical Machine Complex

Kenya to be significantly industrialised the percapita steel consumption which currently at under 30 kilos will shoot rapidly to over 300 kilos. A fair level of economic development is supported by a steel consumption of approximately 300kg per person per year. Kenya’s population is reported as 38.5 million and therefore the country needs to consume steel to the tune of 11.55 million tonnes per year to be classified as developing industrially. The country in effect should look at setting base industries to produce steel to begin addressing this requirement. In effect, the country needs steel mills with a gross output of crude steel of approximately 12 million tonnes.

The world steel consumption stands at 1.5 billion tonnes with china taking an impressive lead. For Kenya to achieve the vision 2030, steel will therefore be a big component,  a very good example being the multibillion LAPSSET corridor that will see an oil pipeline, oil refinery, international port and airport, railway line and resort cities. Its these vision 2030 flaships that NMC will be steeling.

The vision 2030 power generation  and distribution success will rely of availability of steel. Millions of metric tonnes of steel will be needed to drive the projects. It’s crucial to set up  steel mills so as to handle the various requirements  for steel.

The country can initiate an initial crude steel production through integrated steel mill of the order of 1 million tonnes annual capacity. An integrated steel mill of this capacity costs approximately USD 1 billion. Similarly, 1 million tonne per year capacity integrated steel mill produces as a by-product approximately 100MW of electricity. The downstream rolling mills processing the refined crude steel from the mill will draw power from internally generated electricity from the process of smelting.  To cushion the vision Kenya will need 12 million tonnes of steel, NMC intends address this by laying a foundation in  putting a seed of up to 1 million tonnes of steel. Plans are underway to acquire a mini steel rolling mill for production wrought steel products and high quality steel through the use of locally available steel.

Why NMC and not private sector ? All the private investors in the steel industry are producing redundant steel  and not the special steel. The different is in the quality and precision. Indeed the special steel is a foundation to industrial development because that’s where  you get the machine tools, machinery and machinery components like rollers. To invest in special steel production  will need a bigger investment and serve a lean market. This will not be a lucrative investment for profit driven business men. This is the gap that NMC under the ministry of industrialization intends to fulfil majorly through public private partnership.

The power transmission components of the machines require steel whose properties can be altered after machining to impart properties such as hardness for abrasion resistance or resistance against wear, strength and toughness to guard against catastrophic failure by fractures or bending etc. Such steels are not readily available locally and their scarcity is a major drawback to industrial manufacturing. This factor affects manufacturing in the country in general and not only NMC. There is also a major knowledge gap concerning such steels and getting the needed grade for a particular application is very difficult owing to this fact. NMC is therefore spearheading to setting up of a steel mill to address this issue.

NMC strategic positioning?
Previously, NMC’s core activity was centered on the service to industries by provision of spares for repair  of equipment and machines. It was impossible to plan and budget for the operations for this nature of manufacture because it was not clear which parts would fail in the industry and of what materials and sizes they were and  which tools , machines and personnel would be involved. It  was therefore not easy to fulfil the requirements of performance contracting and also cash flow was unpredictable. NMC therefore changed strategy to come up with line products to give it identity and also use the defined products to enable the company to plan and budget for the operations.

{flike}{fsend}

{fcomment}