The Federal Government of Nigeria has signed a renegotiated concession agreement with Global Steel Holdings Ltd for the Nigerian Iron Ore Mining Company (NIOMCO), Itakpe, to revive the dead Ajaokuta Steel Complex.
After years of dormancy as a result of dispute over the ownership of the steel company, FG has finally reclaimed and has effectively released entity from all contractual encumbrances that had halted its completion for more than a decade.
Dispute over the ownership of Ajaokuta Steel Complex and NIOMCO had made it impossible for government to make any long‐term plans for the concession or privatisation of the two companies.
The new agreement was signed, after four years of mediation, at the office of the Vice President, Yemi Osinbajo on Monday, August 1.
Witnesses to the signing ceremony include: the Minister of State for Solid Minerals Development, Abubakar Bwari; the International Mediator, Phillip Howell-Richardson, and top officials of the Ministries of Justice and Solid Minerals Development.
Speaking at the agreement ceremony, Prof. Osinbajo said the Ajaokuta Steel Complex is one of the cases of failures and immense proportion of assets Nigeria could not enjoy for years.
The Vice President maintained that making the entities to work remained a top priority of the administration, and urged GSHL to keep to the various timelines in the agreement in the spirit of mediation. He said it’s important for the concession to work “so that Ajaokuta can take off too.”
Speaking further, Mr. Fayemi who led the federal government side in the mediation process explained that expectations borders on two things: Bringing NIOMCO to full function and retaking and handing over the complex to new operator. He said:
“With this, we will move from being just a mineral nation to a mining nation.
“Once the first phase of the agreement is accomplished, it is the intention of the FGN to quickly move into accomplishing the objectives of concessioning the Ajaokuta Steel Plant to the most competent operator who meets the requirements of credible track record, technical capacity and financial competence.”
Fayemi also commended the team from the Federal Ministries of Justice and Solid Minerals for their hard work and also thank GSHL for sticking to the provisions of the laws in seeking resolutions to the problem.
Also speaking, the GSHL Chairman, Mr Mittal, said the company waited for eight years to achieve this amicable settlement.
He assured the government of its readiness to commence operation soon, adding that in the next two years Nigeria would begin to produce steel.
Recall that earlier this year, there has been many offers from companies in countries like Russia, Ukraine and Germany has proposed to rebuild the Ajaokuta Steel Complex. The complex was originally constructed a Russian TyazhpromExport (TPE).