Global Steel Holdings Limited is reportedly preparing to sue the Federal Government over the control of the Ajaokuta steel mill. This was was hinted by the Minister of Mines and Steel Development, Olamilekan Adegbite during the inspection of the National Iron Ore Mining Company (NIOMCO) at Itakpe, Kogi State.
Why? The FG was said to have backed out of an agreement which allowed the firm to have concession of NIOMCO after the breakdown of the concession agreement of Ajaokuta Steel to the Indian company for a 10-year period.
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Nairametrics understands that both NIOMCO and Ajaokuta Steel Complex are on FG’s agenda as plans to revive the two long-abandoned national assets have kicked off. Also, provisions were made for the iron ore mining company in the 2020 budget.
This was also confirmed when the minister was quoted saying that the ‘concession modification agreement’ with the GSHL did not make any sense, as he vowed that Nigeria would keep both Ajaokuta Steel and NIOMCO.
“As it where, Aladja (steel mill) has already been privatised and sold but Ajaokuta and Itakpe are still in government hands and will produce to the benefit of the people of Nigeria, no matter whose ox is gored.
“These people (GSHL), they are not our friends, they don’t want Nigeria to produce steel and they have successfully done it over the years.
“As it were, they are preparing to go back to some court abroad to embarrass Nigeria but I’m sure the country is capable of meeting them at this point and we will not surrender our sovereignty to some individuals,” Adegbite said.
What you should know: The company, Global Steel Holdings Limited is an Indian company which won the concession of the Ajaokuta steel mill. However, the agreement was revoked when the Federal Government accused the firm of asset stripping – a development that led to a court case between the two parties.
To resolve the matter, instead of having Ajaokuta, NIOMCO was reportedly ceded to the GSHL to conclude the remaining period of the concession in line with an agreement reached during mediation talks.
[READ ALSO: Ajaokuta Steel capable of creating not less than 600,000 jobs – NIMMME boss]
Why this matters: There have been talks about the revival of the Ajaokuta steel mill in recent times since the Russian company, MetProm entered an agreement with the Federal Government. There is a possibility that the fresh legal case may affect this agreement between the two parties.