Lucky Cement’s decision to light a second kiln at Samawah, Iraq, on 13 May 2025 marks a watershed moment in the global ambitions of Pakistan’s best‑known construction‑materials group. In a short notice to the Pakistan Stock Exchange the company confirmed that the new 1.82‑million‑tonne‑per‑annum clinker line, built alongside the 1.31 Mtpa unit commissioned in 2021, has entered hot‑run testing and is expected to reach commercial dispatches in July.
The achievement is not simply an engineering milestone; it pushes Lucky’s consolidated name‑plate capacity above 21 million tonnes a year across three countries and demonstrates that Pakistani industrial capital, honed in the hills of Khyber‑Pakhtunkhwa, can thrive in the post‑war economy of the Middle East.
The Samawah expansion is housed in Najmat Al‑Samawah, a 50‑50 joint venture between Lucky Cement and the UAE‑based Al‑Shumookh Group. Built by China’s Sinoma International, the second line can fire 5,800 tonnes of clinker a day on a fuel mix dominated by southern Iraqi natural gas, supplemented by up to twenty per cent alternative fuels such as rice husk and shredded tyres. A 25 MW captive power plant hums next door and a waste‑heat‑recovery unit—planned for 2026—should whittle electrical consumption by another twenty‑five kilowatt‑hours per tonne. When a 0.65 Mtpa grinding and packing facility at Umm Qasr comes on line, probably early in 2026, the Samawah complex will supply cement and clinker to an arc that stretches from Baghdad and Basra to Kuwait, Bahrain and the Horn of Africa.
If geography explains part of the attraction, economics seal the deal. Iraq’s appetite for cement has bounced back to roughly twenty‑five million tonnes a year on the back of state‑funded housing, oil‑field infrastructure schemes and the continuing reconstruction of Mosul. Many of the country’s legacy state‑owned plants remain crippled by under‑investment, so effective domestic capacity is materially below the notional forty‑million‑tonne figure often cited by officials.
Imports from Iran and Turkey still plug a three‑to‑four‑million‑tonne gap. A Samawah‑produced tonne of clinker delivered to a central‑Iraqi mill is six to eight US dollars cheaper than an imported tonne once transport and duties are included; the arbitrage is larger still in Kuwait, which has capped its own carbon‑heavy cement production. As Lucky is paid largely in US dollars, the company also gains a natural hedge against the chronic depreciation of the Pakistani rupee.
The Iraqi strategy meshes neatly with Lucky’s plan to create self‑contained regional clusters. The forthcoming Basra grinding mill will be fed entirely by Samawah clinker, sheltering it from the import tariff Baghdad imposed in 2024 to nurture fledgling local production. Surplus material from Samawah can travel by rail‑and‑road into Kuwait or move as coastal shipments to East Africa. Conversely, if Pakistani coal prices spike, management has hinted it might ship Iraqi clinker back to its Karachi plant, turning a foreign asset into a domestic hedge.
This outward push is the culmination of three decades of restless growth. Lucky started in 1993 with a modest kiln at Pezu, spent the early 2000s layering on debottlenecking projects, and by 2012 had emerged as Pakistan’s largest cement producer. It then hedged its bets abroad: a 1.31 Mtpa plant in the Democratic Republic of Congo in 2017, the first Samawah line four years later, solar and wind farms in Sindh, and a majority stake in Kia‑Lucky Motors at Port Qasim. The latest Iraqi kiln lifts foreign operations to twenty‑eight per cent of group EBITDA; the board wants that figure above a third by 2027.
No foreign venture is free of risk and Iraq carries more than most. A disruption to the Basra gas pipeline could force the plant onto costlier imported coal; Baghdad’s intermittent price controls might crimp margins; and the security situation, though calmer in Al‑Muthanna than in the north, still demands expensive convoy protocols for spare parts sourced via Kuwait. Perhaps the biggest long‑term threat is the next capacity cycle: at least eight million tonnes of new Iraqi and Saudi capacity is slated to appear between 2026 and 2028, and another supply wave could push clinker discounts wider unless the economy keeps expanding.
The broader Iraqi chessboard is becoming more crowded. Lafarge Iraq runs six million tonnes of capacity at Karbala and Bazian; Northern Region Cement of Saudi Arabia has commissioned a 1.3 Mtpa line; Sinoma and Al Diyar expect to fire a 1.8‑million‑tonne kiln in Samawah later this year; and Chinese‑backed projects are sprouting in Erbil. Effective utilisation will hinge on whether Iraq can sustain gas supplies, keep its reconstruction budget funded and restrain regional competition. Lucky’s early‑mover advantage—and Al‑Shumookh’s local political heft—give it a head start, but vigilance will be required to protect margins.
Seen through the lens of capital allocation, the second Iraqi line is a calculated gamble—but one Lucky appears well placed to manage. The Al Nabulsi family controlling Al‑Shumookh brings deep political networks in Samawah; the region’s natural‑gas bounty lowers the plant’s carbon and cost footprints; and Lucky’s in‑house engineering division has accumulated a store of expertise in building kilns quickly and cheaply. If the group can navigate sovereign‑risk shocks and the cyclical vagaries of cement, Samawah could supply dollar earnings for a generation and serve as a template for other Pakistani conglomerates venturing abroad.
For Iraq, the 1.82‑million‑tonne addition reduces dependence on imports, supports an embryonic construction boom and signals that serious foreign capital—albeit from a frontier‑market peer rather than a Western multinational—judges its risk‑reward equation acceptable. For Pakistan, it proves that local know‑how, born of decades of coping with energy shortages and currency swings, can compete—and win—far from home. And for Lucky’s shareholders, it reaffirms a strategic credo that has served them well for thirty years: in a commodity business, staying one kiln ahead of the competition is often the surest path to durable returns.
