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From Juliana Taiwo-Obalonye, Abuja
The Federal Government has admitted that the Muhammadu Buhari administration it will no longer complete the Ajaokuta steel rolling mill in 2022, as earlier promised.
It blamed the COVID-19 pandemic as well as the Russia-Ukraine war for frustrating the project on several fronts, despite the fact that President Buhari has approved $2 million for the project.
It has therefore, resolved to engaged a British firm which is offering it services for free, to revive the struggling Ajaokuta Steel Company Limited for free.
Minister of Mines and Steel Development, Olamilekan Adegbite, said this to on Thursday while addressing State House Correspondents during the special weekly briefing, coordinated by the Presidential Communications Team at the Presidential Villa, Abuja.
According to him, the federal government had, before the pandemic, successfully convinced Russia to complete the steel facility but could not proceed with the negotiations due to what he called force-majeure brought about by the COVID-19 pandemic.
The deal with Russia involved a $2 million fee for technical audit required to ascertain the state of the facility before works would begin.
Adegbite further explained that the government moved to continue the negotiations with Russia after the lockdown, but progress was again stalled due to the conflict between Russia and Ukraine.
He, however, noted that the federal government would initiate irreversible processes to ensure the resumption and eventual completion of the steel facility beyond the Buhari administration.
According to the Minister, “in October 2019, Nigeria’s President Muhammadu Buhari and Russia’s Vladmir Putin met at the Russia-Africa Summit in Sochi and agreed to revive the uncompleted Ajaokuta steel mill but the project suffered force majeure due to COVID-19”
Adegbite who did not name the British firm, however stated that the arrangements with the Russian firm failed as the contract was awarded to a company with both Russians and Ukrainian interests.
He disclosed that the $2 million is safe in the federal government account, adding that “ the money has not even been given to anybody, the Russians can’t get any payment now with the way things are happening in the world. All their accounts are blocked.
“So the $2 million is still with the federal government is just that the President has given the money for that purpose. We had started the process of procurement, then with this war, we can no longer go that way.
The Minister revealed that the “British firm is offering to do it for us free now” adding that “By the grace of God, we have started an irreversible process. The problem with Ajaokuta is actually what we call force majeure. Nobody thought of the COVID, because the plan was to deliver Ajaokuta this year 2022.”
The Minister, who regretted that the company may not be fully revived under the current administration, as earlier promised, said: “where we are today, we may not be able to get Ajaokuta to work but I pray that we can start something permanent. I’ve said it before, when we came back from Russia, yes, I went to the public and said, look we will deliver Ajaokuta before the end of this tenure. And I pray that I’ll have a chance to go back and apologize and explain what happened to the people before I leave office.
“It is due to no fault of ours. Everybody was ready to go, but unfortunately, COVID came in. So, it is a force majeure”
Adegbite speaking on his achievements in office, said his
Ministry is currently working on projects across the six geopolitical zones which will be commissioned by July this year,
Others include the launching of made in Nigeria barite, establishment of mining-related clusters in the six geopolitical zones of Nigeria and Jewellery Making Training Center in Abuja where 45 students recruited from all the 36 States and FCT are being trained on Jewellery Making.
Adegbite also revealed that the country has attained self-sufficiency in Barite production and would no longer need to import from October 2022.
The Minister explained that the Buhari administration is doing everything within it’s powers to upgrade the sector.
He explained: “We are going to auction now bitumen in June, this will bring a lot of money. A lot of foreign companies are showing interest in our bitumen. This is even better than bitumen is found in Canada.
“So, we have a lot of Canadian companies who have shown interest, because Canada supplies the largest volume of bitumen to the world now. So, we have a lot of companies coming from Canada. They want to participate in our bitumen project that will create jobs, give value to government, and of course, will also help when it comes to our projects, road construction.”
“We are about to conclude the Bitumen Auction, we have completed the automation of the Mining Cadastre System to meet international full standards for online mining title and license applications and approvals”
He said the ministry also has Large scale gold production platform through Segilola Gold project and proposed refining through Dukia Gold and Kian Smith.
“The famous Ladi Kwali Pottery Center is being remodelled and resuscitated to train Nigerians in Modern pottery and ceramic works.”
Adegbite noted that the Nigeria Mining Development Company (NMDC) has signed a Memorandum of Understanding MOU with the Defence Industries Corporation of Nigeria (DICON) to produce alloys hitherto imported from China.
“Under the MoU, Brass will be processed for Armament and Lead for Ammunition.
“We have repositioned the SMDF and we are finalizing an amendment to the act to further institutionalize the fund along global best practices.
Adegbite revealed that Nigeria has commenced gold exports through the Segilola resource development, which is expected to export 100, 000 ounces of gold annually.
“Their production capacity is 100,000 ounces per annum. You can plan on that. We know how much we are charging per ounce of gold at that rate. So you know that in a year, this is what we are expecting. We charge at 3% but the price will vary because our price is based on the cost that is going at the international market, the New York exchange will quote the price of gold at any particular point in time.
“That’s our reference price. So it’s not fixed as in like, Oh, it must be N10 every year. Gold went as high as $2,500 per ounce at a point. And I think it’s worth about $2,200 now, on the stock exchange. So this is the price as used to calculate that.”
Fielding a question on the gold mining in Zamfara State, the Minister said the government had halted mining activities in the area because the conflict went beyond mining.
On the government’s effort against illegal mining, he said, “we try to nip them in the bud wherever they rear their heads. With the community reporting to us, we have a quick intervention force. We can’t be proactive, it is too expensive to maintain. But we have a quick intervention force.
“If we hear any mining happening in any nook and cranny, we move in there and dislodge them. Those that are arrested, we confiscate their equipment and they are prosecuted.”
The Minister disclosed that government is
reviewing Mining Act, 2007 to bring it up to date, saying that 44 solid minerals have been found in over 500 locations in Nigeria with many in commercial quantities.
According to him, the mineral deposits are broadly categorized according to their uses, into five groups.
