*To enforce ‘use it or lose it’ doctrine for mining licences
22 December 2015, Sweetcrude, Abuja – The Federal Government of Nigeria has commenced an audit of its privatised assets, especially Ajaokuta Steel Company, with a view to taking them over in the new year.
The Minister of Solid Minerals Development, Dr. Kayode Fayemi, who gave this indication yesterday in Abuja during his maiden press briefing, described the parlous condition of the steel rolling mills in Nigeria as shameful and unacceptable.
The previous administration had faced numerous legal constraints in its bid to take over the Ajaokuta Steel Company of Nigeria located in Kogi State, after its agreement with the last concessionaire fell apart.
The Minister said that before the end of the first quarter of 2016, the Federal Government would take over the enterprise and run it profitably.
He said, “It is not only Ajaokuta. We need to disentangle them (steel rolling mills). We will take that as a priority. It is unacceptable to any sane person to abandon such a project. We will partner people who can make it happen.
“This is a sector that can provide a million direct jobs and more indirect jobs. We need to formalise those jobs (informal jobs) so that we can bring them into the sector.”
According to Fayemi, Ajaokuta has a 110 megawatt of power plant that can supply the whole of Kogi and Ekiti. We need to fix Ajaokuta and we will fix it,” he promised.
He added that apart from Ajaokuta, the Federal Government is also interested in taking over the operations of the Delta Steel Company, the Nigerian Iron Ore Mining Company, Itapke, and the Aluminium Smelter Company of Nigeria (ALSCON).
He added that, any current holder of mining licence who fails to use it would forfeit such by March next year when the Ministry would start enforcing the “use it or lose it” doctrine as enshrined in the Nigerian Minerals and Mining Act.
Fayemi pointed out that the country’s solid minerals sector currently accounts for about 0.34 per cent of Gross Domestic Product (GDP), which translates to about N400 billion in value to the economy.
“While this is a significant role, it is smaller than the true potentials of the sector. In fact, what has been happening is that the sector has more or less been operating sharply below capacity, with many mining operations manned by small scale artisanal miners as opposed to large scale players,” the Minister said.
The Minister noted the global decline in prices of commodity, but said the good news was that Nigeria has a great deal of domestic demand for industrial minerals and metal.
“So we will focus on working with other MDAs to ensure that demand is met by Nigerian miners and processors,” he said.