The federal government says it has approved N853.25 million to engage consultants for the concession of the Ajaokuta Steel Company and national iron ore complex, Itakpe, Kogi state.
Lai Mohammed, minister of information and culture, said this while briefing journalists after the FEC meeting presided by President Muhammadu Buhari on Wednesday in Abuja.
The minister said the approval followed a memo presented by Olamilekan Adegbite, minister of mines and steel devolvement.
According to Lai, the contract includes a value-added tax (VAT) of 7.5 per cent.
“Council approved the engagement of transaction advisors for consultancy services for the concession of Ajaokuta Steel Company Limited and also the National Iron Ore Mining Complex in Itakpe in favour of Messrs CPCS Transform Consortium in the sum of N853,266,644.4 inclusive of 7.5 per cent VAT,” he said.
“I am sure we are all familiar with the history of the Ajaokuta Steel complex. The contract was awarded in 1979 to a Russian company called TPE. By the end of 1983, the contract had reached an advanced stage. Regrettably, since then it has been suffering and by 1994, TPE demobilised from the site and in 1996, the contract was terminated.
“Subsequently, various administrations have tried to revive the Ajaokuta Steel Company without much success. However, you will recall that Mr President was on a state visit to Russia on October 22 and 24, 2019, and here it was resolved that the Ajaokuta Steel Company, which the federal government has made a massive investment, must be resuscitated.”
Mohammed added that when the plants are fully revived, Nigeria will have the benefit to save more money, and enjoy technology transfer among others.
He said an opportunity had initially come to reinvigorate the company but was slowed down by the COVID-19 pandemic.
“We believe that with this development, we would have made significant steps in bringing back to life both the Ajaokuta and the Iron Ore Company in Itakpe and moving forward the industrial revolution of Nigeria,” he added.
“When these two complexes begin to function, then, not only are we going to save money in terms of foreign exchange, but we are going to see a lot of industrial development and also technology transfer.”