BUA Group clinches US$200m to finance establishment of new integrated sugar project

NIGERIA – BUA Group, one of Nigeria’s leading manufacturing conglomerate, has received a US$200 million corporate facility from Africa Finance Corporation (AFC), Africa’s leading infrastructure solutions provider, to complete its vertically integrated sugar facility in Lafiagi, Kwara State, Nigeria.

The proceeds will be utilised for the development, construction, commissioning and operations of the Lafiagi Sugar Company (LASUCO).

LASUCO, a first of its kind in Nigeria, is an integrated milling factory that will comprise of a 20,000 hectares plantation, 2,200,000 tons sugar milling plant and a 200,000 tons per annum sugar refinery that will process and refine white sugar.

The facility will also have an ethanol plant that should produce 25 million litres of ethanol annually and a 35-megawatt power plant that will produce renewable energy from bagasse – sugarcane residue

The Project will enable the export of excess energy not consumed on site to the national grid and will recycle most of its other waste products from effluents and vinasse for irrigation, and fertiliser production.

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Abdul Samad Rabiu, Founder and Executive Chairman of BUA, said, “We are pleased to partner with Africa Finance Corporation – a leading multilateral finance institution focused on Africa’s infrastructure and industrial development, on our Lafiagi Sugar Project, which is one of the most ambitious sugar plantation projects in West Africa.

“Upon completion, the Project will utilise best-in-class processing technology and clean renewable energy through the treatment and recycling of effluents, agricultural waste, and solid waste.”

The Project will go a long way towards solving Nigeria’s current dependence on imported sugar raws by utilizing homegrown processed cane sugar and through its integrated-out growers initiative.

BUA Group boosts Nigeria’s sugar production capacity

The Group’s strategy is also in line with the Federal Government of Nigeria’s Sugar Master Plan which emphasizes backward integration programmes for self-sufficiency in sugar production.

Nigeria’s National Sugar Master Plan (NSMP) introduced in 2012 was designed to attract over US$1 billion annually in local and foreign direct investments and create an estimated 107,000 jobs over the first ten-year period.

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Its aim is to raise local production of sugar to enable the country attain self-sufficiency; stem the tide of unbridled importation; create huge number of job opportunities and to contribute to the production of ethanol and generation of electricity.

Therefore, in order to achieve this, it estimated that the country would need to establish some 28 sugar factories of varying capacities and bring about 250,000 hectares of land into sugarcane cultivation, over the next 10 years.

The bulk of this investment is expected to come from private investors and mandates sugar companies to invest in sugar farming and increasingly use locally produced extracts for their refineries, a process called backward integration.

Samaila Zubairu, President & CEO of AFC said, “We are pleased to support this landmark project which will significantly reduce Nigeria’s sugar import bills, currently estimated at over US$400 million per annum.

“The Project should over its useful life reduce Nigeria’s sugar import bills by approximately US$2B and create about 15,000 direct and indirect jobs that will accelerate development impact in the economy.”

The BUA company currently has a sugar refinery capacity of 1.5 million MT from its Lagos and Port Harcourt facilities and targets an increase to 1.7 million MT when the new factory becomes fully operational.

Other than venturing into sugar production, the company has also boosted investment in the grain industry, as it is recently installed a new pasta processing plant with a capacity of 720 tons per day and a flour milling plant with a total milling capacity of 2,400 tons per day.

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