• Wednesday, June 19, 2024
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Ajaokuta steel revival attracts $10 billion investment, says Minister Audu

FG secures $10bn investment for Ajaokuta revamp

Shuaibu Audu, the minister of steel development, has announced that the federal government has attracted at least $10 billion investments from various investors towards the revitalization of the Ajaokuta Steel Complex and National Iron Ore Corporation (NIOMCO).

Speaking at the ongoing 2024 Ministerial briefing in Abuja, on Thursday, Shuaibu said that aside from the original builders of the plant, the Tyamzhpromexport (TPE), many others have shown interest in investing in reviving the plant.
Read also: Ajaokuta Steel Company: A monument to mismanagement
Shuaibu who noted that his ministry had been given two mandates following its creation by President Tinubu, said “One is the revival of the Ajaokuta steel complex and the National Iron Ore Company (NIOMCO) as well as the revival of the steel industry.”

In his words “Jindal Steel Group had indicated an interest in investing up to $5 billion in a new steel plant in Nigeria on the sidelines of the G20 meeting in New Delhi, India, in September 2023, and is now considering either acquiring existing plants or setting up greenfield plants.”

He further informed that upon the completion of these deals, about $10 billion worth of new investments in both new and existing steel plants in Nigeria will be established, which will create over 500,000 direct and indirect jobs in the steel industry in line with President Tinubu’s Renewed Hope Agenda for massive job creation through industrialization.”

Shuaibu recalled that the Steel Plant which was built over 45 years earlier, was already at 98% completion when it was left comatose at the end of the Shehu Shagari administration in 1979. He added that several efforts by previous administrations to complete the project had remained unfulfilled.

“With the President’s commitment, we are at the final stages of securing an N35b investment from private investors to start the light steel rail. We have obtained presidential approval to raise private capital to restart the Ajaokuta light section rail so that we can produce iron rods”.

Read also: Idle Ajaokuta steel mill costs Nigeria N49bn

The minister also informed that a delegation led by the ministers visited the Hefei and Guangzhou regions of China to hold business talks with the Chairman of Luan Steel Holding Group, Wang Jianbing; the Chief Executive Officer of the company, Xiao Weizhan, and other senior executives of the Luan Steel Holding Group.

He further informed that several financial institutions had already provided offer letters for this transaction and that the project is expected to create up to 5,000 direct and indirect jobs for Nigerians.

Shuaibu said the ministry was working closely with the minister of work to provide iron rods for the road infrastructure noting that the administration was already involved in the construction of 30,000-kilometer roads across the geopolitical zones, adding that the ministry was set to create an industrial hub on the Ajaokuta Plant which still has over 2200 hectares of land, considering the plant had been built on only 800 hectares of the plant.

“As part of our efforts to revive the steel plant, we have drafted an internal document split into a 10-year plan and 3year plan for the revival of the plant and ultimately the sector., he noted.

“Other efforts by the ministry to revive the sector, he said include meeting with key stakeholders and a review of the global steel markets including India and China, drafting of an internal document giving a 10-year plan/ 3-year-old plan for revival of Ajaokuta/NIOMCIO, consultations with industry stakeholders to plan the way forward.

Shuaibu further informed that the ministry currently needs between N2-5m dollars to draft a roadmap and put all the network in place towards the revival of the plant adding that they were also in the process of enhancing the regulations of scrap metals and engaged the national association of scrap metals dealer to provide regulatory oversight for the sector.”