Nigerian govt, Global Steel in legal tussle over Ajaokuta deal

Ajaokuta Steel Complex

The Nigerian Government is currently locked in arbitration with Global Steel Holdings Limited over a concessionary agreement for the multi-billion naira Ajaokuta Steel Company that has gone awry.

Vice President Namadi Sambo has set up a committee chaired by the Minister of Justice and Attorney-General of the Federation and comprising the ministers of Mines, Labour, Finance, Director-General of Bureau of Public Enterprises (BPE) and the Chairman of the Interim Management Committee, which is charged with drawing up the government’s position on the matter before September 30, 2011 when the arbitration is scheduled to resume.

A statement from the vice president’s office said the committee has two weeks to come up with recommendations.

Global Steel Holdings Ltd. through its subsidiary, Global Infrastructure Nig. Ltd., sought for arbitration in London on the Ajaokuta Steel Company and National Iron Ore Mining Company (NIOMCO) at Itakpe over the share purchase and concession agreement reached with the Nigerian Government under the former president Olusegun Obasanjo’s administration.

Sambo called a meeting on Saturday to take a critical look at the share purchase and concession agreement involving the government and Global Steel Holding Company Ltd, and three companies, the Delta Steel Company, Nigerian Mining and Iron Ore Company, Itakpe and the Ajaokuta Steel Company.

Sambo also dismissed the options provided by Global Holdings over a negotiated settlement out of arbitration insisting that government would pursue its position.

He also observed that government would explore the possibility of taking the necessary the steps to recover its lost assets allegedly stripped by the company in the Ajaokuta Steel Company.

He noted that the release of the sum of N650 million was to get some units become operational such as the rolling mill and the 110mw thermal power plant.

He was optimistic that the power plant when effectively revamped would contribute in the provision of electricity in the country noting that the steel rolling mill would only use 40% of the total output available while the balance would be transferred to the national grid.

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  • Oscar, you’re a man after my own heart. It’s time for us to stop making ecsuxes and blaming it all on everyone else. OK the governments need to step up and do their bit but we can do our bit too.If we all took steps to change things bit by bit, over time those bits will all amount to rather a lot. By that time international government action will be kicking in too. Surely that’s something?Also, to be fair to our government they have been one of the better ones. We have strategies in place, some elements have been ratified in law and some are acted on by more local agencies. The fact is that if we step back and look at the overview we have achieved a huge amount over recent years. More needs to be done nationally, of course, but it’s the international impact that will be crucial.Our weather system is at the edge of so many others which means we get the impacts from other countries failures. To think that we won’t probably won’t suffer the worst outcomes is awful but that isn’t because we won’t get the weather, rather that we are more affluent so can cope better. Our loss is often more material. Lives lost, although devastating are generally few in number. Africa, Bangladesh and so many other countries will see the worst of it through flooding, famine, disease and more. We all have a responsibility to do something. At least, do something.