The Federal Government of Nigeria has signed a Memorandum of Understanding (MoU) with a Russian consortium for the rehabilitation and operation of the Ajaokuta Steel Company Limited and the National Iron Ore Mining Company (NIOMCO). This significant agreement was formalised during a visit by the Minister of Steel Development, Prince Shuaibu Abubakar Audu, to Moscow.
The consortium, which includes Tyazhpromexport (TPE), Novostal M, and Proforce Manufacturing Limited, aims to revitalise Nigeria’s steel industry, particularly in Kogi State. The MoU follows the consortium’s inspection of the steel and iron ore mining facilities in Ajaokuta and Itakpe in August 2024.
Prince Shuaibu highlighted that this project aligns with President Bola Tinubu’s vision to industrialize Nigeria and reduce the nation’s heavy reliance on imported steel, which currently costs approximately $4 billion annually.
Reviving the Ajaokuta Steel Plant and NIOMCO is expected to enhance Nigeria’s manufacturing base, save foreign exchange, and create over 500,000 direct and indirect jobs, contributing significantly to the economy and supporting the goal of achieving a $1 trillion economy by 2030.
During the working visit from September 14 to 21, 2024, the Nigerian delegation met with key stakeholders, including Alexey V. Gruzdev, Deputy Minister of Industry and Trade of the Russian Federation, and toured Novostal M’s advanced facility, which boasts an annual production capacity of 1.2 million metric tonnes of steel. The Russian partners expressed their commitment to the project and called for the Nigerian government to create an enabling environment for smooth operations.
The Permanent Secretary of the Ministry of Steel Development, Dr. Chris Osa Isokpunwu, reiterated Nigeria’s commitment to the project, aiming to boost the nation’s industrial capacity and economic growth.
The federal government previously announced plans to sign a similar MoU with a Russian firm in 2020 under the administration of former President Muhammadu Buhari. However, the signing was delayed due to the COVID-19 pandemic.
In the 2024 budget, the government allocated N4.45 billion to the dormant Ajaokuta Steel Company and sought N35 billion from funding institutions for its revival, which is estimated to cost between $2 billion and $5 billion.
