Federal Government Stands Firm On Implementing Three-Year Revival Plan For Ajaokuta Steel Company

Federal Government Stands Firm On Implementing Three-Year Revival Plan For Ajaokuta Steel Company....KINDLY READ THE FULL STORY HERE▶

The Ministry of Steel Development, under the Federal Government, is moving forward with the concession process for the long-idle Ajaokuta Steel Company, signaling a concerted effort to expedite its revival. Minister of Steel Development, Shuaibu Audu, revealed this development during an interaction with journalists in Abuja, emphasizing a three-year ultimatum to initiate operations and steel production, aligning with President Bola Tinubu’s directive……..CONTINUE READING

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This decision follows closely on the heels of a High Court in Kogi State restraining the government from the planned concession of Ajaokuta Steel Company Limited and the National Iron Ore Mining Company at Itakpe about a year ago.

In 2022, during the tenure of former President Muhammadu Buhari, the Federal Executive Council approved the engagement of transaction advisors for consultancy services amounting to N853 million for the concession of the steel company. However, strong opposition hampered efforts to revive the dormant steel company that has languished for 45 years.

Addressing the plans during the interview, Minister Audu outlined a three-year roadmap to rejuvenate the steel company, aiming to reverse the prevalent trend of 90% steel importation into the country. He indicated that the objective is to commence production of steel within the next three years, involving the operation of the light steel mill and engineering workshop at full or near-full capacity. Additionally, the concession of the plant to a qualified concessionaire is part of the strategy, potentially spanning 10 to 30 years to enable the recovery of the concessionaire’s capital.

The minister stressed that the implementation of this roadmap, requiring a $5 billion investment, has the potential to generate 500,000 jobs and yield approximately $10 billion in revenue. He highlighted the consideration of various options with stakeholders to avoid the pitfalls of previous administrations and mentioned the resolution of ongoing litigation.

Minister Audu explained, “We would need between $2 billion and $5 billion to revive this entire Ajaokuta Steel Complex.” He detailed plans to restart the Light Steel Mill section with an estimated cost of N35 billion, targeting the production of 50,000 metric tonnes of iron rods. The anticipated economic impact includes a substantial reduction in the current 90% steel import dependence, leading to a significant saving of over $4 billion spent annually on steel imports.

In addition to reviving Ajaokuta Steel, the ministry is exploring collaborations with foreign investors, particularly Chinese investors, to establish new steel plants in the country. The goal is to achieve 90% local steel production and 10% import, ultimately boosting the nation’s steel sector and fostering economic growth.

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