Pretoria Portland Cement (PPC) has announced a R604 million upgrade and expansion of its Hercules plant in Pretoria in a bid to address the cement shortage in the country.

John Gomersall, CEO of PPC, said the project, expected to be operational by mid-2009, would involve the installation of a new million-ton-a-year mill and storage facility.

PPC recently announced a R1,4 billion upgrade of the Dwaalboom Batsweledi plant, which is scheduled for the second quarter of next year. The upgrade would increase capacity by an additional 1,25 million tons.

The Hercules plant expansion project will be financed through a combination of operating cash flow and borrowings.

This project will be spread over the three financial years of 2007, 2008 and 2009.

"The project approval follows a period of detailed design and feasibility study, and is in line with the company's commitment to playing its part in meeting the country's growing cement demand, whilst also modernising ageing equipment," he said.

Gomersall said that due to the skills shortage in the country, PPC's contractors for the Dwaalboom Batsweledi project were forced to import skills and material from abroad to ensure the project was completed on schedule.

Gomersall explained that although PPC had a skills development programme, its focus was on cement manufacturing, which required different skills to those required for factory erection and installation.

He said good progress was being made on the expansion and upgrading of the company's 1,25-million-tons-a-year Riebeeck West plant in Western Cape.

"The project is in the environmental impact assessment stage and we still anticipate presenting the project for board approval in about August this year," said Gomersall.

During the past few months PPC had imported Surebuild cement to supply the Cape Town and Port Elizabeth markets due to shortages that threatened to bring the construction industry to a standstill.

But the company says the situation has improved, and customer requirements could be met from its own local production supplemented by supplies from its Zimbabwe operations.