*Technical audit to be ready in six weeks
09 March 2018, Sweetcrude, Abuja – The Federal Government has vowed not to repeat the mistakes of former administrations by pumping money into the moribund Ajaokuta Steel Complex in Kogi State.
The Minister of Mines and Steel Development, Dr. Kayode Fayemi, who stated this at a press conference in Abuja, also said the present administration would not spend any money to complete the steel plant.
Fayemi, who stated that the Federal Government had sunk over $8 billion into the project since 1979 without any result, pointed out that no fewer than 14 organisations from different countries had since 2016 indicated interest in the Ajaokuta Steel Complex.
He said, “We have also said to them that we are not going to repeat the mistake of the (ex-President Olusegun) Obasanjo administration. We will not undertake the re-concession without one, a technical audit; two, a transaction advisory service that will look into all these and advise us accordingly as to who really has the technical capacity, the financial wherewithal, and the track record to really bring Ajaokuta back to life.
“However, the government took a principled position on one thing: that Nigeria will not spend one dollar on the so-called completion of the Ajaokuta steel plant. The reason for that is very simple; today from our record, we have spent close to $8bn since 1979 when this process started and we have not seen the result.”
The minister added that the government and the House of Representatives agreed on the concession of the plant and that the House approved the sum of N2bn for the purpose in 2017.
The House had last week passed a vote of no confidence in Fayemi and the Minister of State for Mines and Steel Development, Alhaji Abubakar Bwari, following their failure to appear before it for sectoral debate on the steel plant.
The lawmakers also instructed the ministers to suspend every step towards the concession of the plant, adding that they preferred that the government should invest and complete the project.
Fayemi, however, said that the government had taken a decision not to spend any money on Ajaokuta since over $8 billion had been sunk into the project by successive administrations since 1979.
According to him, the House agreed on the need to give out the plant as a concession by approving N2bn for the process in the 2017 Appropriation Act.
He said, “We are just implementing what was passed by the National Assembly. That is why we are surprised that we have been subjected to an unwarranted attack over the matter in the last one week.
“Ajaokuta is an inherited challenge. The Chief Olusegun Obasanjo administration gave it out on concession; the President Umaru Yar’Adua government revoked it. And the case went to the London Court of Arbitration. Its resolution in 2016 led to the signing of the Modified NIOMCO Agreement, which ceded the complex back to the Federal Government and NIOMCO to Global Steel Holdings Limited.
“No fewer than 14 parties have shown interest in running the complex, but government’s position is that we would not do any concession without a technical audit.
“PricewaterhouseCoopers was engaged to do a review of the company’s indebtedness and statutory liabilities as part of the settlement agreement.”
The minister added, “The National Assembly appropriated N2,096,500,000 for Ajaokuta concession in the 2017 Appropriation Act duly passed into law. We are just commencing what was passed into law by the National Assembly.
“This is why I am surprised at how we have been subjected to vitriolic attacks in the last one week. The March 1 sectoral debate, which we could not attend, was the first and only one I and the Minister of State were unable to attend and we duly communicated this to the leadership of the House.
“We take exception to allegations that are not backed up by evidences. Allegations that officials of the ministry have had their hands tied by the concessionaire are quite unfounded.
“The Russian government has not indicated interest in Ajaokuta. Yes, we have had offers from companies from Ukraine, Russia, Belarus and even Nigeria.
“Yes, I have met with the Russian Ambassador the same way I have met with the Ukrainian Ambassador and many other ambassadors. The Russian Ambassador told me they can offer technical, management and audit support, but not as a country bringing in money to take over the complex.
“Many are saying Ajaokuta is 98 per cent completed. The ministry believes that can only be determined by the outcome of the technical audit, which should be ready in about six weeks.”
Fayemi reiterated that the President Muhammadu Buhari administration was being painstaking with the Ajaokuta Steel Complex, given the fact that it had been a victim of bad planning and poor execution by past administrations.
“Our interest is to make it work so that it can create jobs and wealth, and we are ready to work with the National Assembly and other stakeholders to ensure its success,” he added.
Fayemi condemned what he called unwarranted attacks by the leadership and members of the House of Representatives on the ministry.
“The House of Representatives has every right to seek for an explanation on any matter relating to what they have appropriated as one responsible for appropriation, and on any matter of public interest. There is nothing fundamentally wrong in the House and its leadership requesting our presence at the sectoral debate that was called last week,” he stated.
Fayemi stated the ministry requested that the appearance of the ministers be shifted to another date.
“We did not think there was anything untoward about our request for another time, partly because this was the fourth time we were going to be speaking to the House of Representatives on the Ajaokuta Steel Complex,” he added.