Can This Russian Firm Fix This Failed Nigerian Mega Project That Is 40 Years In The Making?

By  |  September 23, 2019

Could This Be Hope For The Ajaokuta Steel Mill?

For many years, the Ajaokuta Steel Mill located in Kogi State, Nigeria, has been lying fallow, wallowing in a state of disrepair. But it looks like the moribund steel plant is about to get a new lease of life.

It is understood that a Russian firm known as MetProm Group is looking to resuscitate the long-abandoned facility. The firm has even submitted a proposal to the Federal Government to that effect.

This was made known in a meeting between a delegation of Russian officials and the Ministry of Mines and Steel Development.

The Russian officials were led by the Russian Ambassador to Nigeria, Alexey Shebarshir. The Ministry was represented by the Minister of Mines and Steel Development, Olamilekan Adegbite, and the Minister of State, Uche Ogah.

It is also understood that the Russian company is looking to not only rehabilitate the steel facility but also maintain it once it comes back alive and gets kicking.

Here’s How Things Went Sour

Actually, the Ajaokuta steel facility was originally developed by another Russian firm, TyazhPromExport (TPE). But relations between TPE and the Federal Government deteriorated when the company was accused of being lukewarm about completing the project and consequently cut off.

Kayode Fayemi, a former Minister of Mines and Steel Development, accused the company of not wanting to complete the project when he tried to explain the rationale behind the government’s decision to sever ties with TPE in 2016.

Even though the Russian embassy did tell their own side of the story which suggested that TPE still wanted the Ajaokuta job, they never quite got around to mending fences.

And now it seems another Russian firm in the form of MetProm Group is trying to get the job. Interestingly, MetProm Group does have history with TPE as a number of engineers from the former did work with the latter on the project before TPE fell out with the Nigerian government.

Better Days Ahead

Valery Shaposhnikov, Russian Deputy Head of Mission, Trade and Economic Affairs, urged both parties to forget the bitter past and key into this new offer that would bring the steel complex to full operations.

He also noted that experience of the engineers, who are familiar with the project, would be very important in the actualisation of this deal.

“I honestly do not see much use in muddling about with conjectures of the past. What matters now is an offer by a reliable Russian company, MetProm Group, to put the mill into operation,” Shaposhnikov said.

“Many of MetProm experts had worked with TPE at Ajaokuta complex in the past.  The company (MetProm Group) comes with profound expertise in modern heavy industry and in the Ajaokuta case in particular.”

How We Got Here

Ajaokuta Steel Company Limited (ASCL) popularly known as Ajaokuta Steel Mill is a steel mill in Nigeria.

Built on a 24,000 hectares (59,000 acres) site starting in 1979, it is the largest steel mill in Nigeria, and the coke oven and byproducts plant are larger than all the refineries in Nigeria combined.

However, the project was mismanaged and remains incomplete 40 years later. Three-quarters of the complex have been abandoned, and only the light mills have been put into operation for small-scale fabrication and the production of iron rods.

After several failed attempts at privatisation, the Nigerian government took back control in 2016. The Ajaokuta Steel Mill still had not produced a single sheet of steel as of December 2017.

The light mills were finally put into operation in 2018 for small-scale fabrication and the production of iron rods. However, most of the plant has been abandoned, including the large-scale equipment and the internal railway.

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