OREANDA-NEWS. The European Bank for Reconstruction and Development (EBRD) is supporting energy efficiency in Kazakhstan by facilitating foreign direct investment in the refurbishment of one of the country's largest cement plants, based in the southern city of Shymkent.

A loan of up to 5 billion tenge (EUR 20 million equivalent) will be provided to Shymkentcement, the Kazakh affiliate of Italcementi Group, one of the largest cement producers in the world. In addition, the EBRD is subscribing to up to 1 billion tenge (EUR 4 million equivalent) of shares in Shymkentcement acquiring an equity stake of around 21 per cent.

The financing will facilitate the replacement of four existing "wet process" kilns with a new, energy-efficient "dry process" facility. An important example of private-sector FDI in the fast-growing Shymkent region, the project highlights the region's attractiveness even at a time when the global investment climate remains uncertain.

The new plant will provide modern, efficient local production capacity to support the development of infrastructure, as well as helping to reduce carbon intensity in the Kazakh cement industry. Moreover, it will set a replicable example of introducing alternative fuels, the first time on such a scale in Kazakhstan.

The investment will also contribute to the ongoing EBRD policy dialogue with the Kazakh authorities in regard to CO2 emissions regulations and align the Kazakh emissions-trading systems with international standards.

Shymkentcement in turn will expand its comprehensive energy and environmental-management systems. The company will also undertake education initiatives, providing traineeships and placements in collaboration with local universities and colleges to spread knowledge about energy-efficient technology and environmental best practice.

"We are pleased to join forces with Italcementi Group to invest in local, energy-efficient production facilities which will support infrastructure development in the fast-growing region of Shymkent. This is an important step towards a more efficient, less carbon-intensive future for the industrial sector of Kazakhstan," said Janet Heckman, EBRD Director, Kazakhstan.

"We are proud to partner with the EBRD in this important project in Kazakhstan. This investment is aligned with our goal to become a leader in economic and environmental sustainability across all markets where we operate through the important efficiency gains that the new plant will achieve," said Gabriel Morin, Managing Director of Italcementi Group in Kazakhstan.

Since the beginning of its operations in Kazakhstan, the EBRD has invested close to USD 6.75 billion in the country's economy, with more than half of the total supporting projects in the private sector.