Government hopeful to revive Ajaokuta Steel Company

The Federal Government says it is currently shopping for investors with both financial and technical strength to take over Ajaokuta Steel Mill.

Ime Ekrikpo, director, steel, Ministry of Mines and Steel Development, made this known in an exclusive interview with BusinessDay.

According to Ekrikpo, the government has decided not to further put in extra money into the plant, as it would amount to wasting national resources.

“The efforts we are making is to say that as a matter of policy, government does not have money to sink into Ajaokuta anymore,” Ekripko reiterated.

Ajaokuta, which has been described as a national tragedy, has not produced steel since its inception 40 years ago.
The director, however, expressed optimism of finding capable and qualified investors to take over the plant to perform the purpose the Federal Government intended it to perform when it was set up in 1979.

“There are people or group or consortia who have money and technical capacity to take over Ajaokuta plant and run it exactly to achieve the objective at which government set it up,” he said.

In shopping for the capable company to take over the plant, Ekripko said the government was committed to transparency and openness in its approach and selection process, saying everyone would be given fair chance but without compromising competency.

“We are now taking steps to see how we can select through due process such competent companies that can take over that plant and run it,” he said.

When operational, Ajaokuta Steel has the capacity to create jobs for Nigerians, train Nigerians as well as contribute meaningfully to the nation’s Gross Domestic Product (GDP).

“Ajaokuta project will generate work for Nigerians, transfer skills, develop Nigerian skills and contribute to our national GDP,” he said.

The director, however, did not give a time frame when the selection process will be over and new investor known, but only said “that is where we are now.”

Recall that the former minister, Kayode Fayemi, in 2017, had said that the expression of interest by investors for the Ajaokuta Steel Mill would happen with the next six months.

Ajaokuta Steel was primarily established to take care of the steel requirements of the economy so that Nigeria would no longer depend on the importation of iron steel, which was why the government of Shehu Shagari commissioned the $4.6 billion project four decades ago.

Currently, Nigeria is said to spend $3 billion annually on the importation of steel for domestic use, according to AbdulSamad Rabiu, chairman/CEO of BUA Group, in an interview with journalists in Lagos, recently.
Quoting data from the United Nations COMTRADE database on international trade, Trading Economics says Nigeria’s import of iron and steel was $469.66 million in 2017.