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The Federal Government has announced that it is in the final stages of raising over N35 billion required to restart the Light Mill Section (LMS) of the Ajaokuta Steel Company.
The move is part of President Bola Tinubu’s administration’s commitment to enhancing the country’s economic standing.
The Minister of Steel Development, Prince Shuaibu Audu, revealed this at the Ministerial Sectoral Update on the performance of President Bola Tinubu’s administration in the last year, held in Abuja on Thursday.
Audu stated that the funds are being secured from a local financial institution and are aimed at revitalizing the steel production capabilities of the Ajaokuta Steel Company.
“The local financial institution has given us a final offer,” said Audu, adding that he had forwarded the necessary documents to the Minister of Finance for approval.
The LMS, once operational, has the potential to produce 400,000 metric tonnes of iron rods per annum, significantly contributing to Nigeria’s industrialization efforts.
The minister also highlighted the strategic collaboration with the Ministry of Works to supply iron rods for the extensive road construction projects across the country.
“There are so many roads being constructed in the country, about 30,000km of roads across the six geo-political zones.
We understand that the Ministry of Works needs about seven million metric tonnes of iron rods over those four years (first term) to construct these roads, Ajaokuta can produce 400,000 tonnes,” Audu explained.
Moreover, discussions are underway with the Minister of Defence to revive the Defence Industries Corporation of Nigeria (DICON) to produce military hardware, thereby enhancing security in Nigeria.
The Metallurgical Development Centre is expected to play a crucial role in providing the necessary lead and zinc for this purpose.
Additionally, plans are in motion to revive the Ajaokuta 110 Megawatts power plant, which could not only power the steel plant but also contribute to the national grid.
To overcome funding challenges, the ministry is considering a public-private partnership model, utilizing the Ajaokuta asset as collateral.
The minister emphasized the mandate of the ministry to revive both the Ajaokuta Steel Company and the National Iron Ore Mining Company, as well as the broader steel industry.
Experts have been engaged to ensure the success of this ambitious revitalization project.
This move towards the revival of the Ajaokuta Light Steel Section marks a significant step towards achieving self-sufficiency in steel production and contributing to Nigeria’s economic growth and security.
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