The Federal Government on Monday took a major step in its plan to revitalise the steel sector as it signed a renegotiated concession agreement with Global Steel Holdings Limited for the Nigerian Iron Ore Mining Company (NIOMCO), Itakpe.

By the new agreement, the Ajaokuta Steel Complex has now reverted to the Federal Government, effectively freeing the entity from all contractual encumbrances that had left it uncompleted and non-functional for decades, while GSHL retains NIOMCO.

The new agreement, which came after four years of mediation, was signed at a short ceremony presided by the Vice President, Yemi Osinbajo, in his office at the presidential villa on Monday.

The Minister of Solid Minerals Development, Kayode Fayemi, signed on behalf of the government, while the Chairman of GSHL, Prammod Mittal, signed on behalf of the company.

The Minister of State for Solid Minerals Development, Abubakar Bwari; the International Mediator, Phillip Howell-Richardson, and top officials of the Ministries of Justice and Solid Minerals Development also witnessed the signing ceremony.

Speaking at the event, Prof Osinbajo hailed the mediation process that led to the resolution of the problem that had made it impossible for the two national assets to be functional for years.

“It is one of the cases of failures,” Mr. Osinbajo said. “It is a tragedy of immense proportion that we have both Ajaokuta Steel Complex and NIOMCO and couldn’t get anything out of them for years.”

The Vice President said making the entities to work remained a top priority of the administration, and urged GSHL to keep to the various timelines in the agreement in the spirit of mediation.

He added that it was important the concession work “so that Ajaokuta can take off too.”

Mr. Fayemi, who led the Federal Government side in the mediation process, said with the new agreement on NIOMCO, the next step was to commence the process of taking over Ajaokuta and ensuring that it was given out to a serious operator with proven technical and financial capacity.

Mr. Fayemi said, “It is our expectation that we would accomplish two things- bring NIOMCO to full function and starts the process of retaking Ajaokuta and then give it to a new operator.

“With this, we will move from being just a mineral nation to a mining nation.

“Once the first phase of the agreement is accomplished, it is the intention of the FGN to quickly move into accomplishing the objectives of concessioning the Ajaokuta Steel Plant to the most competent operator who meets the requirements of credible track record, technical capacity and financial competence.

“Overall, we are confident that this landmark settlement is a pointer to what to expect in the Government’s determination to fix the Nigerian mining sector. This is one of the key milestones in the Road Map for the growth and development of the Nigerian mining sector and I want to thank our team from the Federal Ministries of Justice and Solid Minerals for their hard work and also thank GSHL for sticking to the provisions of the laws in seeking resolutions to the problem.”

Mr. Fayemi described the settlement as a landmark development that would help the diversification plans of the President Muhammadu Buhari administration.

The GSHL Chairman, Mr Mittal, said the company waited for eight years to achieve this amicable settlement.

He said his organisation was committed to the objectives of the agreement and guaranteed supply to Ajaokuta plant and Delta Steel Company, after which it would sell what is left to other interested parties.

He assured the government of its readiness to commence operation soon, adding that in the next two years Nigeria would begin to produce steel.

The International Mediator, Mr Richardson, lauded the government and GSHL for opting for mediation as a means of settling the dispute.

Negotiations for amicable resolution of the Ajaokuta crisis had dragged on since 2008, leaving the country’s steel and industrial sectors largely comatose.

Following this settlement, the steel sub sector is on the way to being revitalized and Nigeria’s industrial base solidified, officials said.

Dispute over the ownership of the Ajaokuta Steel Complex and NIOMCO had made it impossible for government to make any long‐term plans for the concession or privatisation of the two companies.

President Buhari gave approval for the execution of the modified concession agreement with Global Steel Holdings Limited, after he received the reports of the mediation meetings from the Ministry of Justice.

The mediation meetings held in London, United Kingdom.

The Federal Government team to the series of meetings was led by Mr. Fayemi, whose ministry is responsible for the steel sector.

One major highlight of the settlement is that the Federal Government was able to negotiate a higher concession fee payable to the it from three per cent of turnover to four per cent of turnover .

Also, the government was assured guaranteed and continued supply of iron ore to Ajaokuta Steel Company Limited as a priority customer.