The Federal Government and Global Steel have signed an agreement for the resuscitation of the Ajaokuta Steel Company in Kogi state.
The signing of the agreement, which took at the State House, Abuja on Monday, is aimed at revamping the Nigeria Iron Ore Mining Company (NIRONCO), Itakpe.
Dr. Kayode Fayemi, the Minister of Solid Minerals signed on behalf of the Federal Government while Pramod Mittal, Chairman of Global Steel, signed on behalf of the company.
Vice President Yemi Osinbajo, who presided over the event, urged the parties to stick to the terms of the agreement in order to achieve the objective of revamping the Itakpe and Ajaokuta companies within the agreed time.
The vice president noted that the signing of the agreement was unique which informed the presence of the media and other stakeholders.
Osinbajo, however, noted that it was a good thing that the country is now able to recover from all that and move towards getting things right.
He stated that everybody in Nigeria keeps talking about what the nation can do with steel, adding that it was “so obvious that steel is such an important requirement and we spent so much on it”.
“This is possibly the first concrete step towards ensuring that all of our complaints are dealt with and that we are able to, not too long from now, produce our own steel. So that we can save ourselves some foreign exchange and create jobs and opportunities for local investments and local individuals who would be interested in working with us on steel,” Osinbajo said.
Fayemi had recalled that in 2008, the Umaru Yar’Adua administration revoked the Itakpe resuscitation contract that was concessioned to Global Steel by the Olusegun Obasanjo administration in 2005.
The concessioning was to last for 10 years.
He added that since the contract was revoked, both parties had been in arbitration and later went into mediation, that resulted is the current agreement signing.
The minister said the determination of the Muhammadu Buhari administration to diversify the economy ignited the effort to ensure that Itape and Ajaokuta came alive again.
According to him, the agreement to return the Iron Ore Mining Company to Global Steel was reached in London in June to enable it complete its concession and ensure that ownership of Ajaokuta returns to the federal government.
Fayemi said that in executing the agreement, other areas such as the rail transportation and ports issues would be addressed by the Ministry of Transportation.
He said that the Iron Ore Company was the core supplier of raw materials for major steel companies in the country and that government had spent $3.3 billion to import steel products since.
He said there was enough iron ore deposit to sustain the local needs, especially the Ajaokuta and Delta steel company, Aladja,
Mittal in a speech said that his company started operations in the country in 2004 with determination to produce steel for the country.
He said the process was long but it was important that the steel sector was developed fast to speed up other types of development in the country.
He said the company was poised to produce three million tons of steel in three years but added that for effectiveness the company would need rail, gas and power supplies.
Howard Richardson, the mediator, said that the mediation gave the best opportunity for wisdom and common sense to prevail and to give the steel industry in the country the best of all possible starts in the future.