Cemex to Expand Capacity at Texas Cement Plant

CEMEX, S.A.B. de C.V. ("CEMEX") (NYSE: CX), plans to expand the production capacity at its Odessa, Texas, cement plant by 345,000 metric tons to nearly 900,000 metric tons per year in order to keep pace with rapidly growing demand in its West Texas market led mainly by the oil and gas industry. By leveraging existing assets and producing value-added products, the company expects to achieve strong returns on its investment.

“This expansion reinforces our longstanding history of serving West Texas and the oil and gas industry by providing superior products coupled with superior customer service,” said Karl Watson, Jr., President of CEMEX USA. “We look forward to remaining a top cement provider to the oil and gas industry as well as supporting the region’s growth in infrastructure and residential construction.”

Why Is Cemex Dallas Tx So Successful?

Unlike other cement producers, Cemex invested in modernisation from the very beginning in order to increase production. As a result, the company made very good profits quite early in its history and quickly became a nationwide market leader. Cemex recorded continuous growth in the first decades after its foundation.

The demand for specialty cement products used in well construction is growing as a result of the use of more efficient extraction technologies, such as horizontal drilling and hydraulic fracturing. Oil wells using this technology typically reach depths of thousands of feet. Specialty well cement is required for the complex application and extreme conditions to which these wells are exposed.

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Company Overview

CEMEX is the second largest building materials company in the world. Their main headquarters is in Monterrey, Mexico, and their U.S. operation is headquartered in Houston, Texas. The company manufactures and distributes cement, ready-mix concrete, and construction aggregates worldwide. Outside of building materials, CEMEX works diligently to nurture the land they own and land nearby their operations to restore habitat and encourage conservation.

Sustainable Business Strategy

At CEMEX, reaching environmental excellence is the main goal of their sustainability model. Integrating sustainability into their business strategy, day-to-day operations, and decision-making processes is a key focus. They hone their efforts and resources on the issues that have the greatest impact on communities, offering significant contributions that benefit their neighbors while enhancing their business.

CEMEX considers its employees to be their greatest asset, as they are key to a successful and continuous sustainability program. Employees work to ensure that they are good neighbors, striving to be active and positive in the communities where they operate. CEMEX employees participate in a wide range of education projects and conservation programs year-round that align with the important needs and priorities of the local community. These voluntary actions demonstrate the company’s continuing commitment to sustainability, as well as promote a culture of appreciation and respect for nature.

CEMEX invests directly into collaborative relationships to care for their natural resources, advancing their vision of “Building a Better Future for our people, our customers, our communities, and our shareholders”.

Environmental Stewardship

CEMEX attributes the success of its conservation efforts to outside collaboration, conservation partnerships, and several staff sustainability stewards. In Texas, CEMEX collaborates with universities, such as Texas A&M, local educators and students, conservation experts, and NGOs, along with a variety of governmental agencies to select activities that best meet the needs of the given region’s biodiversity challenges, ensuring they contribute to areas of greatest conservation need.

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What Problems Faced Cemex?

The challenge facing CEMEX is that if they cannot realize the acquisition fastenough, they could lose profit on Rinker or RMC's projected benefits. With the acquisitionprocess backed up and competitive demand in the IT group, CEMEX is conflicted to pick whichintegration they would like to focus on first to get it done.

While Cemex faces a variety of problems, arguably its debt situation is the most troubling. Cemex has a lot of debt and is a cyclical business. In fact, it has $12 billion of debt. That's a gargantuan amount in comparison with the $4 billion equity market cap.

Cemex's plant at Davenport, CA (FIGURE 1) has faced a number of environmental and operational challenges in its day to day operation. This includes compliance with strict gaseous and particulate emissions regulations, and the market requirement to produce a low alkali cement product. Many of these challenges are dependent on the pyroprocessing system operation and steps taken to optimize one challenge can often have an impact on a separate challenge.

This paper document these specific challenges that have been faced and the solutions that have been taken. Beyond the challenges already faced, the Davenport plant continues to look ahead to continue optimizing the operation and handle any possible challenges for the future.

Cemex Expands Aggregates Reach to North Texas with New Quarry Acquisition

CEMEX USA announced it closed on the purchase of a turn-key, fully-operational aggregates quarry in Chico, Texas, from Blue Star Materials II, LLC, further strengthening its aggregates network and expanding into the Dallas-Fort Worth area.

The 122-acre site and quarry plant located approximately 45 miles northwest of Fort Worth in Wise County with more than 25 years of quality limestone reserves.

“The Dallas-Fort Worth area is expected to grow exponentially over the next 30 years,” CEMEX USA Regional President—Texas and New Mexico Region Joel Galassini says. “By acquiring a quarry that’s currently-operational, we can start contributing to that growth almost immediately and bring CEMEX’s strong network along with our expertise to projects in the Metroplex.”

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