Lucky Cement (PSX: LUCK) is considering an investment of up to Rs. 1.2 billion in National Resources (Private) Limited (NRL) to accelerate copper, gold and other mineral exploration projects in Balochistan.
Lucky Cement currently holds a 33.33% stake in NRL, which focuses on the exploration and development of metals, particularly copper and gold. The company has also secured exploration rights for lead, zinc and other minerals in the province.
NRL has reported significant copper-gold mineralization in the Chagai region, where it is conducting exploration across a large licensed area. The company has identified multiple prospects and carried out drilling to assess the potential of the deposits.
Management said exploration and feasibility studies for NRL’s projects are expected to take three to five years, indicating that the proposed investment is focused on developing potentially viable mining projects over the longer term rather than immediate production.
Meanwhile, Lucky Cement is expanding its renewable energy capacity at its Karachi plant. The company plans to add 15MW of solar power, increasing its total installed solar capacity to 89.3MW. The plant also has 29MW of wind power, with renewable sources currently meeting around 55% of its total energy requirements.
The company said greater use of renewable energy is helping reduce energy costs and its carbon footprint while providing protection against fluctuations in energy prices. However, coal consumption at the Karachi plant remains relatively high due to its older technology. Lucky Cement has installed UTIS technology across all four production lines to improve efficiency and reduce coal consumption.
Lucky Cement is also expanding its international operations. The company has around 15.6 million tons per annum (MTPA) of cement capacity in Pakistan and another 5 MTPA internationally, including operations in Congo and Iraq.
Its Congo operation is operating at high utilization, prompting the company to expand capacity from 1.6 MTPA to 3.2 MTPA. Construction started during the current quarter, with completion targeted within the next 18 months.
Management said strong cash generation provides the company with flexibility to manage contingencies and pursue future investments. Lucky Cement is not currently considering another local cement investment and expects future growth in Pakistan to remain organic.
