The Federal Government says it has reached an advanced stage of raising more than N35 billion required to restart the Light Mill Section (LMS) of the Ajaokuta Steel Company.
The Minister of Steel Development, Prince Shuaibu Audu, said this at the Ministerial Sectoral Update on the performance of President Bola Tinubu’s administration in the last one year,on Thursday in Abuja.
Audu said that a presidential approval had been given to raise the amount from a local financial institution, as part of the Tinubu administration’s resolve to boost the economic profile of Nigeria.
“The local financial institution has given us a final offer.
“I have done a cover letter and forwarded the relevant documents to the Minister of Finance to be able to take the financing on behalf of the Federal Government,” he said.
He said that the LSM had the capacity of producing 400,000 metric tonnes of iron rods per annum, and was critical in shoring up industrialisation in Nigeria.
According to him, he is working closely with the minister of works to supply the iron rods needed for road construction projects in the country from the section.
“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 that four-year period (first term) to construct these roads, Ajaokuta can produce 400,000 tonnes,” he said.
He said that advanced discussions were held with the Minister of Defence, who is in charge of Defence Industries Corporation of Nigeria (DICON), to revive its engineering workshop to produce military hardware to enhance security in Nigeria.
“So, what is required is that we have a Metallurgical Development Centre that has the ability to provide us with the lead and zinc required, to be able to provide and produce some of these military hardware,” he said.
Audu said that plans were ongoing to revive the Ajaokuta 110 Megawatts power plant that could supply power not only to the plant, but also to the national grid.
According to the minister, due to the paucity of funds, it is engaging in a public private partnership where the asset will be used as the collateral vessel to providing financing.
He said talks were ongoing with three potential investors which are: Transcorp power, NigerDelta Power Holding Company and Reticulated Global Engineering.
The minister said the mandate of the ministry was to revive both the Ajaokuta Steel Company and the National Iron Ore Mining company, and also to revive the steel industry, adding that it had engaged experts.
According to the minister, the vision is critical to the Renewed Hope agenda of the president, whose desire is to grow the economy of Nigeria to more than one trillion dollars by the end of the first term, thereby, making the country a G20. Economy.
He said that a minimum of $2 million was needed to revive Ajaokuta Steel, adding that the plan was to concession the company to people that had the competence to get the job done.
