Federal government takes over Ajaokuta steel company.

The Federal Government has finally taken over ownership of the Ajaokuta Steel Complex with the view to engaging a new operator for the company. The decision was reached yesterday after the signing of a new management agreement with Global Steel Holding Limited (GSHL) that would lead to commencement of steel development in the country.

Vice-President Yemi Osinbajo presided over the signing ceremony at the presidential villa, Abuja, signalling the official reversion of the ownership of the complex to the Federal Government.

While the Minister of Solid Minerals Development, Dr. Kayode Fayemi, signed on behalf of government, Chairman of GSHL, Prammod Mittal, signed for his company. Speaking during the event, Osinbajo lauded the mediation process, which led to the resolution of the problems that have made it impossible for the two national assets to be functional for years.

With the signing of a renegotiated concession agreement with GSHL for the Nigerian Iron Ore Mining Company (NIOMCO), Itakpe, the complex has now reverted to the Federal Government.

According to the vice president, the long abandoned Ajaokuta Steel Complex project is one of the cases of failures in the country in the past. He said: “It is a tragedy of immense proportion that we have both Ajaokuta Steel Complex and NIOMCO and couldn’t get anything out of them for years.” Osinbajo explained that making the entities to work was a top priority of the administration.

The vice president, who therefore urged GSHL to keep to the various timelines in the agreement in the spirit of mediation, said that it was important the concession work “so that Ajaokuta can take off too”. In his remark, Fayemi said with the new agreement on NIOMCO, the next step was to commence the process of ensuring that Ajaokuta Steel Complex is given out to a serious operator with proven technical and financial capacity.

Fayemi said: “It is our expectation that we would accomplish two things – bring NIOMCO to full function and start the process of retaking Ajaokuta and then give it to a new operator.

“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 Federal Government 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,” he added.

The chairman of GSHL, Mittal, said the company waited for eight years to achieve the amicable settlement. He said his organisation was committed to the objectives of the agreement and guaranteed supply to Ajaokuta plant and Delta Steel Company, after which it will sell what is left to other interested parties.

Mittal assured the Federal Government of its readiness to commence operation soon, adding that in the next two years, Nigeria would begin to produce steel. Also in his remark, the International Mediator, Mr. Richardson, lauded the government and GSHL for opting for mediation as a means of settling the dispute. Government has said that the new agreement effectively frees the entity from all contractual encumbrances that had left it uncompleted and non-functional for decades, while GSHL retains NIOMCO.