Nigeria in talks with China to revive Ajaokuta steel, NIOMCO as Russia deal stalls

The federal government has initiated talks with the Republic of China to take over the revitalisation of the Ajaokuta Steel Company Limited (ASCL) and the National Iron Ore Mining Company (NIOMCO).

Shuaibu Abubakar, the minister of steel development, spoke on Tuesday at the opening of the 10th edition of Nigeria’s Mining Week, themed ‘Nigeria Mining: From Progress to Global Relevance,’ in Abuja.

Abubakar said the ministry is exploring the partnership after a previous agreement with Russia was abandoned due to complications from the war with Ukraine.

He explained that the war hindered progress on the government’s memorandum of understanding (MoU) with Tyazhmashpromexport (TPE) to rehabilitate, complete, and operate the ASCL and NIOMCO Itakpe in Kogi state, signed in September 2024.

“Mr President will give the final approval based on financial, managerial and technical competencies,” the minister said.

Abubakar said President Bola Tinubu’s government has remained resolute in reviving the steel company from its nearly five-decade comatose state.

He added that the ministry is nearing a deal with the ministry of defence and the Defence Industries Corporation of Nigeria (DICON) to produce military hardware inputs, including rifles, vests, helmets, and bullets, at Ajaokuta steel complex’s engineering workshop.

“This understanding is to support the defence sector of the Nigeria economy for improved security,” the minister said.

Abubakar also said the National Steel Raw Materials Exploration Agency in Kaduna has identified 12 iron ore deposits across the country, currently at various stages of exploration, and is working to generate resource data to drive investments in the sector.

He said the local steel production would boost demand for raw materials like iron ore, limestone, dolomite, refractory coal, and coal, yielding economic benefits.

The minister urged private sector players to invest in the steel raw materials value chain to drive sector growth.

“We are collaborating with critical stakeholders across the federal government, especially our sister Ministry of Solid Minerals Development in this regard,” he said.

Abubakar added that the federal government’s efforts to boost the Nigerian steel industry’s growth through foreign direct investment hinge on a sustainable supply of mineral raw materials.