Present avoidable challenges have necessitated the Nigerian government’s intervention to revamp the Ajaokuta Steel Company, albeit on a Build-Operate-Transfer concession, Financial Street has learnt.
To resuscitate the ailing steel company, the government has set up a committee to be chaired by the Secretary to the Government of the Federation, Boss Mustapha, with the Minister of State, Mines and Steel Development, Mr. Uche Ogah, as the alternate chairman.
This was disclosed by the Director of Information at the SGF’s office, Willie Bassey, who also announced the inauguration of the Ajaokuta Presidential Project Implementation Team to begin the process of reviving the steel plant.
According to Mustapha, the committee is expected to, on behalf of the government, engage in bilateral negotiations leading to the implementation of the government-to-government agreement with Russia that is part-funding the project through the Russian Export Centre, and Afreximbank.
“Today’s inauguration of the Ajaokuta Presidential Project and Implementation Team is, therefore, meant to kick-start the process of redirecting the activities of the steel project back to life for the growth and economic development of our dear nation,” Mustapha said.
He also noted that the unproductive state of the ASC for close to four decades had cost the government.
The committee is also expected to provide all technical inputs and ensure that all raw materials are sourced locally in line with the local content provisions and the Presidential Executive Order 005 as well as assemble Nigerian Content Engineering, Procurement and Construction, Special Purpose Vehicle Contractors, which would embody the co-concessionaire representing Nigeria’s interest in the Build-Operate-Transfer concession.
The government had said the Russian government and the Afreximbank would provide up to $1.46bn in funding to revamp the ASC.