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•Targets agreement before end of 2026
In what it described as a major step towards repositioning Nigeria’s industrial sector, the federal government, yesterday, said it is on course to conclude and sign an agreement with a Chinese company before the end of 2026 to revive the long-idle Ajaokuta Steel Company.
The Minister of Steel Development, Sha’ibu Abubakar Audu, disclosed this during an appearance on the Nigerian Television Authority’s Good Morning Nigeria programme, where he outlined the Tinubu administration’s efforts to restore operations at the steel complex.
According to the minister, the government has made significant progress in securing credible technical and financial partners capable of bringing Ajaokuta Steel back to life, noting that discussions with a Chinese investor have reached an advanced stage.
“For Ajaokuta Steel Company, as you know, it was established in 1979. It hasn’t produced any sheet of liquid steel since its inception. So, what we did in this administration over the last three years is we took a number of measures.
“The first thing that we did was we have now engaged with serious partners to revive and bring in funding for the resuscitation of Ajaokuta. We are now in very, very advanced discussions with some Chinese companies, a Chinese company in particular, and we are confident that before the end of this year we can have an agreement signed for its revival.”
The minister disclosed that the revival of the steel plant would require between $1.5 billion and $2 billion, explaining that the federal government cannot shoulder the financial burden alone.
“Ajaokuta will need somewhere between $1.5 billion to $2 billion for its revival,” he said, stressing that the government is seeking investors with the financial strength, technical expertise and proven track record needed to successfully rehabilitate and operate the facility.
To prepare the steel complex for full restoration, Audu said the government has already initiated several strategic interventions.
He disclosed that the procurement process for a comprehensive technical audit has been completed and that assessment of the plant is already underway to determine facilities requiring rehabilitation and upgrades.
The minister also revealed that the Ministry of Steel Development, in partnership with the Nigerian National Petroleum Company Limited, has commenced the development of five mini-LNG plants within the Ajaokuta Steel complex. According to him, the project is expected to attract about $500 million in foreign direct investment while boosting industrial gas supply in northern Nigeria.
In addition, Audu said the ministry and Ajaokuta Steel have signed a Memorandum of Understanding with the Defence Industries Corporation of Nigeria and the Ministry of Defence to manufacture military hardware, including rifles, ballistic vests and helmets, at the engineering workshop within the steel complex.
He further disclosed that Ajaokuta Steel recently signed a 20-year Gas Sale and Purchase Agreement with NNPC to ensure reliable long-term gas supply for future operations.
The minister maintained that the various initiatives underscore the Federal Government’s commitment to reviving Nigeria’s steel industry and transforming Ajaokuta into a catalyst for industrialisation, job creation and economic growth.
Despite remaining dormant for more than four decades, Ajaokuta Steel has continued to receive annual budgetary allocations from the Federal Government, with personnel costs accounting for the largest share of its expenditure while efforts to attract private investment continue.
