FG signs MOU with Russian consortium to rehabilitate Ajaokuta Steel, NIOMCO

The Nigerian government has signed a Memorandum of Understanding (MoU) with the original builders of Ajaokuta Steel Plant, Thermometer (TPE), and members of the consortium (Novostal M and Proforce Manufacturing Limited) for the rehabilitation, completion and operation of Ajaokuta Steel Plant (ASP) and National Iron Ore Mining Company (NIOMCO) in Kogi State, Nigeria.

The MOU was signed by Shuaibu Abubakar Audu, minister of Steel Development, who led a Nigerian delegation to Moscow, Russia, from 14th to 21st September 2024, on a working visit.

Read also: Done deal: Nigeria signs MOU for $1 billion iron ore to steel plant

A statement signed by Salamatu F. Jibaniya, head of press & public relations department, Federal Ministry of Steel Development, stated that the call was accepted by the Russian Federation when a consortium led by TPE visited the steel plant in Ajaokuta and the iron ore mining site at Itakpe in August, 2024, for preliminary inspections, leading to the invitation for the signing of the MoU.

The statement quoted the minister as saying that, “This is a bold step towards creating a sustainable base for the industrialization of the Nigeria economy, noting that The revival of the Steel sector will also reduce importation of Steel products into Nigeria which is estimated at over $4billion annually and will help save scarce foreign exchange.”

During the visit, the Nigerian delegation met with Alexey V. Gruzdev, deputy minister of industry and trade of the Russian Federation, and the consortium led by TPE, who assured the Nigerian delegation of the readiness of the consortium to meet the expectations of the MoU with the Nigerian Government.

The Nigerian delegation led by the Nigerian minister of Steel also inspected the facilities of Novostal M located in Balakovo in the Saratov region.

The plant, which was in full operation during the visit, has an Electric Arc Furnace capacity of 1.2 million metric tonnes of steel products per annum with a staff strength of 3,900 workers.

The team also inspected the private port facility of the company where they received different raw materials for their operations.

Chris Osa Isokpunwu, permanent secretary, Ministry of Steel Development, in his remarks, affirmed the commitment of the Nigerian government to revamp the Ajaokuta Steel Project and National Iron Ore Mining Company, Itakpe.

Read also: Alake hails $1b China-Nigeria iron ore to steel project

The President of Metallurgical Holding, Demchenko Ivan Ivanovich, assured the delegation of their readiness to submit a detailed proposal for the project after the comprehensive audit of the Plant.

The general director of Messrs. TPE, Egorov Sergei Anatolevich, and the group managing director of Proforce Manufacturing Limited, Adetokunbo Ogundeyin, assured the Nigerian delegation of their commitment to the project because of its critical role in the overall economic development of Nigeria and requested for the provision of an enabling environment by the Nigerian Government.

The parties expressed their optimism that the full implementation of the MoU will facilitate the revival of both Ajaokuta Steel Company Limited (ASCL) and NIOMCO and could create over 500,000 direct and indirect jobs for Nigerians and increase the size of the economy by billions of dollars thus contributing immensely to President Tinubu’s desire to grow the economy to over $1trilion by 2030.