Ardagh Glass Packaging-Africa (AGP-Africa) announced the heat-up of the N3 furnace at its Nigel production facility in Gauteng, South Africa. The delivery of another ZAR 1.5 billion mega-project, within budget and on time in just over 12 months from approval, is a great achievement by all involved.
The Nigel 3 (N3) expansion was announced shortly after the commissioning of the N2 expansion project at the same facility. It comprises a new furnace and four production lines. The expansion will add 50 percent more output to the facility’s production, making Nigel the largest glass container production facility in Africa and one of the largest and most efficient facilities globally.
Despite declining economic conditions in 2023, this investment by Ardagh Group lives up to the acquisition commitments made to government as well as the promise to customers to continue investing in additional capacity ahead of demand growth to ensure sustainable, long-term supply to the industry.
Unfortunately, over the past 12 months during the N3 build, there has been a further decline in demand for glass packaging, mostly due to changes in packaging formats in the beer industry and a large decline in the wine industry in the Western Cape.
“While demand has been disappointing, it is normal for our industry to go through cycles where capacity exceeds installed demand and our facilities need to operate below name-plate capacity for periods of time,” said Paul Curnow, Chief Executive Officer of AGP-Africa. “However, our commitment to long-term growth in South Africa remains unchanged. The recent investments in capacity leave us well positioned, with a modern asset base and reasonable spare capacity to be restarted at short notice when sustainable demand supports additional production.”
Further, the N2 and N3 projects incorporate significant energy, water efficiency and environmental benefits. These represent important steps in AGP-Africa’s journey to decarbonise glass production, reduce emissions in the communities in which the company operates and provide customers with packaging that supports localised closed-loop recycling. Beyond the investment in additional glass capacity, more than ZAR 150 million is being invested in air emissions treatment systems at Nigel to ensure no production impact on air quality. The Nigel facility will also house the company’s single largest renewable project to date – a 10MW solar PV array.