FG Fixes March Deadline For Concession Of Ajaokuta Steel Plant

The Federal Government has fixed March as the deadline to complete the concession of Ajaokuta Steel Company.

The Minister of Mines and Steel Development, Lekan Adegbite, yesterday revealed this during an interview on Arise Television.

About 11 companies have indicated interest to take over Ajaokuta Steel Company on a concession basis.

Three of the 11 bidders are Russian companies.

Built on a 24,000 hectares (59,000 acres) site in 1979, the Ajaokuta Steel Company is the largest steel mill in Nigeria, and the coke oven and byproducts plant are larger than all the refineries in Nigeria combined.

However, the project was mismanaged and remains incomplete over 40 years later.

Three-quarters of the complex have been abandoned, and only the light mills have been put into operation for small-scale fabrication and the production of iron rods.

Buhari had during his campaign in the build-up to the 2015 general election promised to revive the Ajaokuta Steel Company if elected president of the country.

Then, Buhari had while campaigning in Lokoja promised to resuscitate the company, which has been out of production for several years.

But over seven years into his administration, that promise has not been fulfilled.

Investigations by THE WHISTLER had revealed that despite its moribund state, the company is still enjoying huge annual budgetary allocation by the government.

THE WHISTLER had reported that between 2015 and 2022, a whopping sum of N30.51bn has been allocated to the idle Ajaokuta Steel Company Ltd.

Speaking on the development, Adegbite stated that the current arrangement is markedly different from the concession done in the past, where people just come to get things for free.

According to him, the new deal will be based on equity stakes , with the process expected to be completed sometime in March this year.

He said, “The transaction advisor in this case is guiding the federal government on the proper thing to do. We have people who are going to come in into Ajaokuta with their equity.

“We don’t want a free ride anymore. That’s one of the lessons learnt from the past. We’ve learnt a lot of lessons because we’ve had two sessions of concessions of Ajaokuta that failed.

“This time around, we are being guided by experts, and because of the value inherent in Ajaokuta, they appreciate it but we’re saying this time there is no free lunch.”

He noted that President Muhammadu Buhari is the first president in the history of Nigeria to have committed money to mining in the country, of up to the tune of $100m.

“We’ve talked about diversification over the years from one administration to the other, but actually putting money where the mouth is, President Buhari did that and because mining is a very risky venture, the government needs to de-risk the sector.

“We invested money in exploration and of course, acquiring data, which is what President Buhari did, especially from 2017. This data is what is attracting people to the sector now.

“And additionally when we came in, I noticed that we were going the route of petroleum again, where we exported the crude oil and they will bring in refined product, so we started the process of engaging stakeholders.

“It took us about two years, but today it’s an official policy of government. It was approved by council, where without beneficiation you cannot export raw ore from Nigeria anymore.”