Lafarge Announces The Approval Of A Second Clean Development Mechanism

10.04.2006
 

Euronext: LG, NYSE: LR                                               Paris, April 10 2006


Lafarge announces that its Clean Development Mechanism (CDM) project which substitutes alternative, biomass energy sources for fossil fuels in two of its cement plants in Malaysia, has been validated by the CDM Executive Board, in line with the framework established by the Kyoto Protocol.  Registered on April 7, 2006, the CDM project was approved by Malaysian and French authorities.  It is the first CDM project of its kind to be registered by the cement industry.  It is also the second CDM project to be registered by Lafarge, the first being a wind farm, powering the Group's Tetouan cement plant in Morocco which was inaugurated in September 2005.

 

The Malaysian project involves the substitution of a percentage of coal with a biomass alternative, Palm Kernel Shells (PKS), in the cement manufacturing process. PKS are a waste product of Malaysia's palm oil industry. PKS now account for over 5% of energy used in the heating process of the plants' kilns during the production of cement. The Group has calculated that an average of 68,000 tons of PKS per year is necessary to sustain this level of energy.

 

By substituting PKS for coal, Lafarge is able to reduce CO2 emissions by more than 60,000 tons per year - the equivalent of planting four million trees a year.  Moreover, precious fossil fuels are being preserved.  PKS also offer advantages to the local environment and economy including:

 

- The use of a waste product which would otherwise be stockpiled, open to saturation by tropical rains and consequently of no use to any industry

 

- The use of a local product which reduces Malaysia's dependence on coal imports.

 

The registration of this project is the final step in the CDM process. 

 

Lafarge is currently developing two other CDM projects:

 

- In Brazil where limestone is replaced by industrial waste, such as slag (a waste product of the steel industry) in the manufacture of cement.

 

- In India where fly ash (a waste product of coal power stations) is used as a substitute for cement clinker, also in the manufacture of cement.

 

This project is consistent with the Group's voluntary objective to reduce net CO2 emissions by 20% per ton of cement produced worldwide over the period 1990 to 2010, as part of its partnership with WWF. So far, significant progress has been made and in 2005 Lafarge recorded an 12.7% reduction in CO2 emissions.*  It should be noted that this commitment goes far beyond the target set by the Kyoto Protocol, under which industrialized countries (Annex I) must reduce their collective emissions of greenhouse gases during the period 2008-2012 by 5.2% compared to the year 1990. 

 

Note to Editors:

 

The Kyoto Protocol
The Protocol introduced three "flexibility mechanisms" in order to lower the overall costs for countries to achieve their emissions targets. These "flexibility mechanisms" are:

 

- Clean Development Mechanisms: in which Annex I countries can implement projects in developing countries that reduce emissions in return for CO2 credits thereby helping the latter to achieve sustainable development and contribute to the overall reduction of greenhouse gases. The CDM is supervised by the CDM Executive Board based in Bonn.

 

- Joint Implementation:  in which Annex I countries can implement projects similar to CDMs in transition countries, notably in Eastern Europe and Russia.

 

- Emissions Trading:  which allows for the trading of ‘units' between Annex I countries in order for them to meet their emissions targets.  This enables countries to lower the overall cost of reducing emissions. Each ‘unit' is equal to one ton of CO2 emissions.

 

Lafarge in Malaysia
Lafarge is the leader in all four of its businesses in Malaysia. The Group has been present in the country since 1998 when it acquired the roofing company, Hume Redland Industries.  Lafarge first entered the Malaysian cement market in 2001 after the acquisition of Blue Circle and now has forty-one percent of market share.  The Group has three cement plants and a clinker grinding station and a total production capacity of twelve million tons in Malaysia.

 

Lafarge is the world leader in building materials, with top-ranking positions in all four of its businesses: Cement, Aggregates & Concrete, Roofing and Gypsum. With 80,000 employees in 75 countries, Lafarge posted sales of Euros 16 billions in 2005.

 

Lafarge has been committed to sustainable development for many years, pursuing a strategy that combines industrial know-how with performance, value creation, respect for employees and local cultures, environmental protection and the conservation of natural resources and energy. Lafarge is the only company in the construction materials sector to be listed in the 2006 ‘100 Global Most Sustainable Corporations in the World'. To make advances in building materials, Lafarge places the customer at the heart of its concerns. It offers the construction industry and the general public innovative solutions bringing greater safety, comfort and quality to their everyday surroundings.

 

Additional information is available on the web site at www.lafarge.com.  

 

* Unaudited figure for 2005

 

Contacts:

 

COMMUNICATIONS  MEDIA RELATIONS

 

Stéphanie Tessier :33-1 44-34-92-32
stephanie.tessier@lafarge.com

 

Lucy Wadge :33-1 44-34-19-47
lucy.wadge@lafarge.com

 

Louisa Pearce-Smith :33-1 44-34-18-18
louisa.pearce-smith@lafarge.com

 

Updated 10/04/2006