Ajaokuta belongs to Nigerian govt. despite concession dispute – Official

Ajaokuta Steel plant
Ajaokuta Steel plant

The Federal Government of Nigeria on Wednesday said the Ajaokuta Steel Company, ASC, and the National Iron Ore Mining Company Limited, NIOMCO, Itakpe, belonged to it despite a deal agreed recently to settle a legal dispute over the plants.

After several years in limbo, a deal between the Indian Steel giant, Global Steel Holding Company, and the federal government to facilitate the reactivation of the plant, collapsed, throwing the company into a prolonged ownership crisis.

The disagreement had precipitated a legal tussle at the International Court of Justice at The Hague with parties seeking an amicable settlement.

Last September, the federal government and the Indian firm’s subsidiary, Global Infrastructure Nigeria Limited, GINL, said they had reached amicable terms to settle the dispute.

The Minister of Mines and Steel Development, Kayode Fayemi, who announced the deal, said both parties agreed to sign a ‘Modified Concession Agreement,’ which would allow GINL be involved in the management and operation of NIOMCO ”for some years.”

Following the agreement, Mr. Fayemi said the government was proceeding with its plans to conclude arrangements to restart operations at the Ajaokuta Steel plant, with the recent appointment of a Transaction Adviser.

But, on Tuesday, a director of Global Steel Holdings Limited, GSHL, the parent company of GINL, S. O. Nwanbuokei, dismissed Mr. Fayemi’s claims that the protracted litigation surrounding the ownership of Ajaokuta Steel Company had been resolved.

Mr. Nwanbuokei said in a statement that although GSHL expected to be party to the resolution the minister made reference to, he was neither aware of the resolution, nor any settlement reached over the matter.

He said he was, however, aware that GSHL was not responsible for the delay in resolving the matter, pointing out that the company had always been ”open and ready to cooperate with all terms required to arrive at an amicable resolution.”

“We put in all our efforts to conclude the due diligence process in the NIOMCO Itakpe with the conviction that the next phases of compliance with the terms of the International Court of Arbitration would be speedily determined. We regret that this has not been the case”, he stated.

“We are afraid that a message of a similar incorrect formulation may grossly mislead stakeholders both in Nigeria and abroad. We, therefore, request the statement to be removed from the official website address of the Ministry of Steel.”

Mr. Nwanbuokei maintained that GSHL and the Nigerian government were still mediating on claims on assets which remained binding on all parties, warning against any investor that would, in the circumstance, come in until the matter had been determined.

In its reaction, the Ministry of Mines and Steel Development in a statement on Wednesday frowned at Mr. Nwanbuokei’s view which contradicts the minister’s on the matter.

Reaffirming the federal government’s ownership of the Ajaokuta Steel Complex, the Permanent Secretary of the ministry, Mohammed Abbas, said there was no contention about the fact that the company belonged to the federal government.

“The federal government does not need any mediation to determine its ownership of Ajaokuta Steel Complex as the integrated steel complex has always been the property of FGN”, Mr Abbas said.

He said concessioning of Ajaokuta and NIOMCO did not make the federal government lose the ownership of these assets.

For Ajaokuta, he said despite the concessioning, the federal government still remained its actual owner, pointing out that nothing had changed after the entire exercise crumbled.

“The position of government is that having ceded the National Iron Ore Mining Company, NIOMCO, Itakpe to GSHL, for the remaining concession period, as part of the agreement reached during the mediation, the government would, at the appropriate time, take a decision on how best to put Ajaokuta Steel Complex to profitable use”, he noted.


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  • thusspokez

    The disagreement had precipitated a legal tussle at the International Court of Justice at The Hague with parties seeking an amicable settlement.

    This factory is in Nigeria and comes under Nigerian jurisdiction. Who is that idíót in the Nigerian government that okay going to the ICJ.. Can anyone imagine the British or American agreeing to go to the ICJ over a factory located in their respective countries?

    “The federal government does not need any mediation to determine its ownership of Ajaokuta Steel Complex as the integrated steel complex has always been the property of FGN”, Mr Abbas said.

    Damn Right!

  • Okokondem

    In matters of he said, she said, such as this embarrassing spat between the Nigerian government and an Indian company that is now questioning the ownership of Ajaokuta steel complex, you have to wonder how did that happen. If the goal was to partner with an Indian steel company to reresuscitate an otherwise abandoned Ajaokuta complex, why the ambiguity in the contract resulting in questionable ownership?

    Let me go further. Why is it difficult, or impossible in a population of 170 – 180 million to find men and women knowledgeable enough, serious enough, and dedicated enough to to make everyday decisions in the interest of their country?

    It’s not just the Ajaokuta steel complex that was ran aground. It was our refineries, all of them at one point, creating the dreaded oil subsidy saga that drained our collective commonwealth. There was the Nigerian Railway that was moribund for decades before a recent attempt to resurrect a small segment of it. There’s the Nigerian Airways, our once national pride, that is no longer in existence. The failure to provide the population with electricity has become a well known fact worldwide. And so the list goes on…the freaking list goes on.

    So, rather than arrogant chest-thumping display of patriotism as to who Ajaokuta complex belongs to, maybe what discerning minds should be asking is how Nigerians prove to be negligent in such a matter as negotiating on behalf of the country.