The Federal Government on Thursday said it has engaged a British firm to revive the Ajaokuta Steel Company Limited “for free” following the outbreak of war between Russia and Ukraine.
Minister of mines and steel development, Olamilekan Adegbite, stated this while fielding questions from State House journalists at the weekly media briefings organised by the presidential media team.
Adegbite, who spoke on the efforts to revive the steel company under the current administration, stated that President Muhammadu Buhari had released $2 billion in 2020, to revive the project, under an arrangement with a firm comprising both Russians and Ukrainians.
According to the minister, “in October 2019, President Buhari and Russia’s Vladmir Putin met at the Russia-Africa summit in Sochi and agreed to revive the uncompleted Ajaokuta steel mill.
He stated that the contract could not take off due to the COVID-19 global pandemic, adding that “the project suffered force majeure due to COVID-19”
Adegbite, who did not name the British firm, however, stated that the arrangements with the Russian firm failed as the contract was awarded to a company with both Russians and Ukrainian interests.
He said the $2 billion was safe in the Federal Government account, adding that “the money has not even been given to anybody; the Russians can’t get any payment now with the way things are happening in the world. All their accounts are blocked.
“So the $2 billion is still with the Federal Government is just that the President has given the money for that purpose. We had started the process of procurement but with this war, we can no longer go that way.
The minister revealed that the “British firm is offering to do it for us free now” adding that “by the grace of God, we have started an irreversible process. The problem with Ajaokuta is actually what we call force majeure. Nobody thought of the COVID, because the plan was to deliver Ajaokuta this year 2022.
The minister regretted, however, that the company may not be fully revived under the current administration, as earlier promised.
“And I’ve said it before when we came back from Russia, yes, I went to the public and said, look we will deliver Ajaokuta before the end of this tenure. And I pray that I will have a chance to go back and apologise and explain what happened to the people before I leave office.
Read also: ‘Russia-Ukraine war may threaten Ajaokuta steel plant’
“It is due to no fault of ours. Everybody was ready to go, but unfortunately, COVID came in. So, it is a force majeure”
Adegbite speaking on his achievements in office, said his ministry was currently working on projects across the six geopolitical zones which will be commissioned by July this year,
Others include the launch of made-in-Nigeria barite, establishment of mining-related clusters in the six geopolitical zones of Nigeria and jewellery making training centre in Abuja where 45 students recruited from the 36 states and FCT are being trained on jewellery making.
“We are about to conclude the bitumen auction. We have completed the automation of the mining cadastre system to fully meet international standards for online mining title and licence applications and approvals”
The ministry also has a large scale gold production platform through the Segilola Gold project and proposed refining through Dukia Gold and Kian Smith.
“The famous Ladi Kwali Pottery Centre is being remodelled and resuscitated to train Nigerians in modern pottery and ceramic works.
He noted that the Nigeria Mining Development Company (NMDC) has signed a memorandum of understanding (MOU) with DICON to produce alloys hitherto imported from China.
“Under the MoU, brass will be processed for armament and lead for ammunition. We have repositioned the SMDF and we are finalising an amendment to the act to further institutionalise the fund along global best practices.
Adegbite revealed that Nigeria has commenced gold exports through the Segilola resource development, which is expected to export 100, 000 ounces of gold annually
“Their production capacity is 100,000 ounces per annum. You can plan on that. We know how much we are charging per ounce of gold at that rate. So you know that in a year, this is what we are expecting. We charge at three percent but the price will vary because our price is based on the cost that is going at the international market, the New York exchange will quote the price of gold at any particular point in time.
“Our reference price is not fixed. Gold went as high as $2,500 per ounce at a point. And I think it’s worth about $2,290 now, on the stock exchange. So this is the price as used to calculate that.
