‘$1.2bn Needed To Turn Around Ajaokuta Steel Plant’

Abuja – The National Assembly has been told that the comatose Ajaokuta Steel Rolling Complex will become operational if the sum of $1.2 billion is invested into it.

The Sole Administrator of the complex, Sumaila Abdul-Akaba, made the disclosure at an interactive session with the Senate and House of Representatives Joint Committee on Power, Steel Development and Metallurgy.

In his presentation, Abdul-Akaba gave breakdown of the amount to include: $513 million for rehabilitation, completion and commissioning while $687 million will be used for balance of external infrastructure.
He pointed out that Nigeria could save over $10 billion annually if the steel company was brought on stream.

He noted that following the last technical audit of the steel plant in 2010, it was estimated that about $1.2 billion was required to achieve the total rehabilitation, completion and commissioning of the plant.
The amount, he said, included balance of external infrastructure.

He appealed to the Committee to ensure the total rehabilitation, completion and commissioning of the steel complex, describing the plant as viable.

The Sole Administrator also told the Committee that by April this year, 55mw electricity plant installed in the complex would come on stream.

He said that there were 10,000 houses in the complex with about 4,000 completed.

Abdul-Akaba assured the Committee that machines installed in the complex are first class, stressing, that “all we need to do is to sort out legal issues surrounding Ajaokuta Steel to bring the plant to run.”

It was gathered that the Enyinnaya Abaribe-led Committee has concluded arrangements to visit the Steel Complex for firsthand information as well as to see how that the National Assembly can facilitate the rolling out of steel.
The Federal Government and Messrs Global Steel Holding Limited, an Indian firm, began negotiations for amicable resolution of the ownership of Ajaokuta Steel Complex in 2008.

The Ajaokuta Steel Company is being developed in three phases and the first phase of 1.3million tonnes steel production has reached about 98 percent completion before the contract was terminated in 1996.

Also in his submission, Minister of Mines and Steel Development, Kayode Fayemi, revealed that a combination of funding and litigation constraints was delaying the rehabilitation and completion of the steel company.

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The Minister said that they are addressing the issue of institutional capacity and infrastructure.

According to him, “For the first time states are also getting 13 percent derivation due them from solid mineral exploited from their states.”

Source: Independent

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