The Federal Government has signed a Memorandum of Understanding (MoU) with Tyazhpromexport, the builders of the Ajaokuta Steel Plant, for the rehabilitation, completion, and operation of the facility, along with the National Iron Ore Mining Company (NIOMCO).
Shuaibu Audu, the Minister of Steel Development, signed the agreement on behalf of the government in Moscow, Russia, as stated by the ministry’s spokesperson, Salamotu Jibaniya, on Friday.
EKO HOT BLOG reports that the signing occurred during a visit by the Nigerian delegation to Moscow from September 14 to 21, 2024.
The Ajaokuta Integrated Steel Complex, originally conceived in 1979, was intended to establish a full-scale metallurgical process plant, along with an engineering complex and supporting facilities. However, the plant has remained non-operational due to corruption and legal hurdles.
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The complex is key to generating both upstream and downstream industrial activities, crucial for diversifying Nigeria’s economy toward industrialization. Since assuming office, Audu has assured Nigerians that the plant will soon begin steel production, reducing the country’s reliance on steel imports.
To move forward, experts from Tyazhpromexport visited the Ajaokuta plant and the iron ore mining site at Itakpe for preliminary inspections in August, culminating in the invitation to sign the MoU. Novostal M and Proforce Manufacturing Limited, both part of Tyazhpromexport’s consortium, were also involved in the agreement.
The Nigerian delegation also toured Novostal M’s facilities in Balakovo, located in Russia’s Saratov region.
Audu described the agreement as a critical step toward creating a sustainable foundation for Nigeria’s industrialization. “Reviving the steel sector will also reduce Nigeria’s steel imports, which cost over $4 billion annually, and help conserve foreign exchange,” he stated.
Chris Isokpunwu, Permanent Secretary of the Ministry of Steel Development, reaffirmed the government’s commitment to revamping the Ajaokuta Steel Plant and NIOMCO.
The Russian consortium assured Nigeria of their commitment to fulfilling the terms of the MoU. Demchenko Ivan Ivanovich, President of Metallurgical Holding Novostal M, expressed readiness to submit a detailed project proposal following a comprehensive audit of the plant.
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Egorov Anatolevich, General Director of Tyazhpromexport, and Adetokunbo Ogundeyin, Group Managing Director of Proforce Manufacturing, emphasized their dedication to the project, which is seen as crucial for Nigeria’s economic development.
They noted that full implementation of the MoU could revive the Ajaokuta plant and NIOMCO, creating over 500,000 direct and indirect jobs and significantly boosting the economy.
The executives also requested the Nigerian government to ensure an enabling environment for the project’s success.
The MoU is expected to significantly contribute to President Bola Tinubu’s goal of growing Nigeria’s economy to over $1 trillion by 2030.
Audu was accompanied on the trip by several key officials, including Isokpunwu, Sumaila Abdul-Akaba, Sole Administrator of Ajaokuta Steel Company Limited, and Loto Isinmidun, Acting Sole Administrator of NIOMCO.
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