We won’t spend money on Ajaokuta Steel Company again – FG

On Thursday, the Federal Government said it would not repeat the mistake of the former President Olusegun Obasanjo’s administration on the Ajaokuta Steel Complex in Kogi State.

The Minister of Mines and Steel Development, Dr. Kayode Fayemi, who stated this at a press conference in Abuja, also said the present administration would not spend any money to complete the steel plant.

Fayemi stated that the Federal Government had sunk over $8bn into the project since 1979 without any result.  The minister stated that no fewer than 14 organisations from different countries had since 2016 indicated interest in the Ajaokuta Steel Complex. He said,

“We have also said to them that we are not going to repeat the mistake of the Obasanjo administration. We will not undertake the re-concession without one, a technical audit; two, a transaction advisory service that will look into all these and advise us accordingly as to who really has the technical capacity, the financial wherewithal and the track record to really bring Ajaokuta back to life. However, the government took a principled position on one thing: that Nigeria will not spend one dollar on the so-called completion of the Ajaokuta steel plant. The reason for that is very simple; today from our record, we have spent close to $8bn since 1979 when this process started and we have not seen the result.”  

The minister added that the government and the House of Representatives agreed on the concession of the plant and that the House approved the sum of N2bn for the purpose in 2017.

The House had last week passed a vote of no confidence in Fayemi and the Minister of State for Mines and Steel Development, Alhaji Abubakar Bwari, following their failure to appear before it for sectoral debate on the steel plant. The lawmakers also instructed the ministers to suspend every step towards the concession of the plant, adding that they preferred that the government should invest and complete the project.

Fayemi, however, said that the government had taken a decision not to spend any money on Ajaokuta since over $8bn had been sunk into the project by successive administrations since 1979.  According to him, the House agreed on the need to give out the plant as a concession by approving N2bn for the process in the 2017 Appropriation Act.

He said, “We are just implementing what was passed by the National Assembly. That is why we are surprised that we have been subjected to an unwarranted attack over the matter in the last one week. Ajaokuta is an inherited challenge. The Chief Olusegun Obasanjo administration gave it out on concession; the President Umaru Yar’Adua government revoked it. And the case went to the London Court of Arbitration. Its resolution in 2016 led to the signing of the Modified NIOMCO Agreement, which ceded the complex back to the Federal Government and NIOMCO to Global Steel.  “No fewer than 14 parties have shown interest in running the complex, but government’s position is that we would not do any concession without a technical audit.

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