In a landmark move aimed at driving Nigeria’s industrialization and boosting economic growth, the Federal Government of Nigeria, represented by the Honourable Minister of Steel Development, Prince Shuaibu Abubakar Audu, has signed a Memorandum of Understanding (MoU) with Russia’s Tyazhpromexport (TPE) and its consortium partners for the rehabilitation, completion, and operation of the Ajaokuta Steel Plant (ASP) and the National Iron Ore Mining Company (NIOMCO).
The signing took place during a working visit of the Nigerian delegation to Moscow, Russia, from September 14-21, 2024.
In a statement by Salamatu F. Jibaniya, Head: (Press & Public Relations Department)
Ministry of Steel Development which was made available to newsmen on Friday in Abuja stated that this agreement marks a significant step toward the revival of Nigeria’s steel industry, which has the potential to transform the country’s economic landscape. The rehabilitation of Ajaokuta Steel Plant, located in Kogi State, and NIOMCO, Itakpe, is seen as a critical foundation for Nigeria’s industrial future.
Prince Shuaibu, driving President Bola Tinubu’s mandate to complete and operate Ajaokuta Steel Plant, emphasized the significance of the agreement, noting that the revival of the steel sector will reduce Nigeria’s dependency on steel imports, which cost the country over $4 billion annually. “This is a bold step toward creating a sustainable base for the industrialization of the Nigerian economy,” he stated, stressing that the project would save foreign exchange and provide a crucial platform for local steel production.
The signing of the MoU followed a preliminary inspection of the Ajaokuta Steel Plant and NIOMCO facilities by a Russian consortium led by TPE in August 2024. The consortium’s inspection paved the way for further collaboration and the formalization of this crucial partnership.
The Nigerian delegation met with the Deputy Minister of Industry and Trade of the Russian Federation, Mr. Alexey V. Gruzdev, where the Russian-led consortium assured the Nigerian delegation of their readiness to fulfill the expectations of the MoU. The delegation also visited the Novostal M plant in Balakovo, Saratov region, where they inspected the plant’s full operation. The Novostal M plant, which produces 1.2 million metric tonnes of steel annually, showcased its advanced facilities and capacity for large-scale steel production, with a workforce of 3,900 employees.
During the visit, the Nigerian delegation also inspected Novostal M’s private port facility, where the plant receives raw materials, demonstrating the company’s integrated operations. This visit reinforced the consortium’s commitment to leveraging their expertise in the steel industry to drive the Ajaokuta Steel Project forward.
Dr. Chris Osa Isokpunwu, the Permanent Secretary of the Ministry of Steel Development, reaffirmed the Nigerian government’s commitment to revamping Ajaokuta Steel and NIOMCO. The President of Novostal M, Demchenko Ivan Ivanovich, assured the delegation that a detailed proposal for the project would be submitted following a comprehensive audit of the Ajaokuta Steel Plant.
Messrs. TPE’s General Director, Mr. Egorov Sergei Anatolevich, and Proforce Manufacturing Limited’s Group Managing Director, Mr. Adetokunbo Ogundeyin, expressed their commitment to the project, recognizing its critical role in Nigeria’s overall economic development. They requested the Nigerian government’s continued support in creating an enabling environment to facilitate the project’s successful implementation.
The successful execution of the MoU is expected to create over 500,000 direct and indirect jobs in Nigeria, significantly boosting the economy. The revival of Ajaokuta Steel Plant and NIOMCO is projected to contribute billions of dollars to Nigeria’s GDP, aligning with President Tinubu’s vision of growing Nigeria’s economy to over $1 trillion by 2030.
Prince Shuaibu Audu led the Nigerian delegation, which included key officials such as the Permanent Secretary, Dr. Chris Osa Isokpunwu, and other top representatives from Ajaokuta Steel Company Limited and NIOMCO, underscoring the high priority the government has placed on the success of this strategic project.
The MoU with the original builders of the Ajaokuta Steel Plant represents a critical step forward in Nigeria’s industrial future, with the potential to make the country a leading player in the global steel industry.