President Bola Tinubu has given authorization for the establishment of an inter-ministerial committee dedicated to spearheading three major steel development initiatives in Nigeria.
This includes the revival of the dormant Ajaokuta Steel Mill.
The Minister of Steel Development, Shauibu Audu, disclosed this development following a meeting with President Tinubu at the State House in Abuja, attended by the Minister of Defense, Abubakar Badaru.
Formation of the Committee:
The committee comprises prominent figures such as the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, Minister of Industry, Trade and Investment, Doris Uzoka, Minister of Solid Minerals Development, Dele Alake, along with the Minister of Defence, Muhammadu Badaru, and the Minister of Steel Development, Shuaibu Audu.
Key Responsibilities:
Audu outlined the committee’s primary responsibilities, including securing funding for the revitalization of Ajaokuta Steel Company Limited, facilitating the establishment of a steel plant by China’s Lu’an Steel Holding Group, and identifying a suitable location for India’s Jindal Steel to set up a proposed steel plant.
Potential Job Creation:
Highlighting the significance of these projects, Audu emphasized that successful execution, especially the revival of the Ajaokuta steel mill, could generate around 500,000 jobs under President Tinubu’s administration.
Engagement with Lu’an Steel Company:
Audu revealed that two committee members engaged with Lu’an Steel Company, a leading Chinese steel manufacturer committed to establishing a new steel plant in Nigeria.
The Chinese company is set to send an advanced team to Nigeria after the Chinese New Year, expected by the end of February 2024.
Cost Estimates and Local Funding Approval:
Discussing the financial aspects, Audu disclosed that reviving the entire Ajaokuta Steel plant would cost Nigeria between $2 to $5 million, while restarting the living steel section would require about N35 billion.
He mentioned President Tinubu’s approval to raise funds locally for the initial phase of the Ajaokuta Steel Plant project.
Commitment from Jindal Steel:
Audu conveyed plans regarding Jindal Steel, stating that the company, which pledged $5 billion, had committed further to secure an ideal location for its operations in Nigeria.
Options include setting up a greenfield or acquiring an existing plant, such as the Delta steel plant.
Military Hardware Establishment:
The Minister highlighted the establishment of military hardware capabilities at Ajaokuta steel plant, with the Chinese team agreeing to assist Nigeria in this endeavor within one of the production units.
Investigation into Ajaokuta’s Electricity Debt:
In response to Ajaokuta Steel Company Limited accumulating N33 billion in electricity debt, Audu expressed plans to investigate the situation.
He questioned the high electricity consumption when the plant was not operating at full capacity. Audu emphasized the need for collaboration to address outstanding amounts and ensure the success of Ajaokuta’s revival.
Conclusion:
President Tinubu’s endorsement of the inter-ministerial committee underscores a commitment to advancing crucial steel development projects in Nigeria.
The initiatives aim not only to revitalize Ajaokuta Steel but also to foster collaboration with international partners, potentially creating significant job opportunities and contributing to the nation’s economic growth.
The minister’s plans for local funding and addressing electricity debt challenges reflect the comprehensive approach taken to ensure the success of these endeavors.