Ajaokuta Belongs to Nigerian Govt. Despite Concession Dispute – Official

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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.

Credit: Premium Times

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