The Minister of Mines and Steel Development, Mr. Olamilekan Adegbite, has said that with the progress made during the Russia-Africa Summit in Sochi, the Federal Government is praying that production in Ajaokuta Steel company should begin within the next two or three years.
President Muhammadu Buhari in October, met with President Vladimir Putin during the summit to discuss opportunities in exploring and expanding security, trade and investment, science and technology, and gas production.
The highlights of the meeting include putting Nigeria-Russia relations on a fast track and pursue the completion of partially completed and abandoned projects initiated by both countries.
Mr Adegbite who was a guest on Channels Television’s Politics Today gave more insight on the outcome of the meeting and what the mid-term expectations are about the Ajaokuta steel company located in Kogi state, which has gulped billions of naira by successive administrations since Nigeria returned to democracy in 1999.
The Minister explained that the Federal Government is looking at exploring the potentials of the mines and steel sector in its diversification drive, owing to what it can offer the country if properly harnessed.
He added that government in the past had adopted different methods, including the private and commercial sector to complete and ensure it produces steel, but all attempts have been futile.
“Government had tried in the past since Ajaokuta was completed to make sure that it produces steel; we tried with the private and commercial sector, but it never worked.
“We have tried using the private sector to kick-start Ajaokuta but it never worked, so we decided to go back to the original builders of Ajaokuta which was built by the Soviet Union in those days, particularly between Russian Federation and Ukraine, which is the request the President made to President Putin in Russia and he agreed on this government to government relationship to bring Ajaokuta back on stream.”
On the issue of funding, he revealed that support will be gotten from both the Russian Export Centre and the African Export-Import Bank (AFREXIM Bank), while adding that both governments are still studying the draft Memorandum of Understanding, with the hope that concrete steps will be taken afterward.
“We are at that point where both sides are understudying the draft MoU and we are hoping that before the end of the year or early January, we will be able to sign this MoU.
“Once that is done, it would kick-start the proper agreement with a Russian company, nominated by the Russian Government coming over to complete the works in Ajaokuta and we are praying that within the next two years or three, Ajaokuta should be able to produce,” he stated.
Mr. Adegbite added that the multibillion-dollar Ajaokuta Steel Mill, the largest in Nigeria, has a great chance and the agreement with the Russian government will make it work.
Ajaokuta steel construction started in 1979 by the Soviet Union under a corporation agreement with the Federal Government. The project reached 98 percent completion but is yet to produce a single sheet of steel to date.
In April, President Buhari rejected assent to a bill, Ajaokuta Steel Company Completion Fund passed by the eight National Assembly headed by Senate President, Dr. Bukola Saraki.
He explained that appropriating $1 billion from Excess Crude Account for funding the project as stipulated in the bill was not the best strategic option for Nigeria and such amount cannot be deployed, owing to the priorities given to other socioeconomic projects.