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BREAKING….Senate begins probe of Ajaokuta Steel Coy, NIOMCO over $496m payment



Worried by the alleged incidences of corruption and inefficiency at the Ajaokuta Steel Company Limited and the National Ore Mining Company, NIOMCO in Kogi State, the Senate, on Tuesday, set up investigative panel to look into the affairs of the two companies from 2008 to date.

Specifically, the Red Chamber resolved to unravel the mystery behind the payment of $496million allegedly made to Mr. Pramod Mittal, Chairman, Global Infrastructure Holdings Ltd, GINL by the federal government in September 2022 as settlement over said contractual disputes.

It is also investigating the circumstances that led to the re-concession of NIOMCO even when the initial concession agreement was validly terminated by the Umaru Yar’Adua administration with positive review by the International Chamber of Commerce, London.

These resolutions followed a motion sponsored by the Senator Natasha Akpoti-Uduaghan (PDP Kogi Central) during plenary.

To this end, Senator Adeniyi Ayodele Adegbonmire SAN (APC Ondo Central) is to be the chairman of the investigative panel while Senator Kawu Suleiman (NNPP Kano South) is to be the deputy chairman.

Other members of the committee are: Senators Natasha Akpoti-Uduaghan (Kogi Central), Onawo Mohamed (Nasarawa South), Joel Onowakpa (Delta South), Sen Onyesoh Allwell Heacho (Rivers East) Abdullahi Yahaya (Kebbi North), Patrick Ndubueze (Imo North), Tokunbo Abiru (Lagos East) and Osita B. Izunaso (Imo West).

While the committee is to report back to the Senate in two weeks, they are also to invite and interface with relevant ministries, departments and agencies, MDAs and other critical stakeholders in the steel sector especially those with interest in Ajaokuta Steel Manufacturing Plant and NIOMCO to obtain relevant information and submit a comprehensive report to the Senate regarding the affairs of the two plants from 2018 to date.

The Senate is also urging the federal government to review extant policies and laws on steel development in Nigeria with a view to adopting a strategic implementation Plan on Steel Development in Nigeria bearing in mind the importance of steel to Nigeria’s quests for industrialization and economic self-reliance and also investigate alleged incidences of corruption and inefficiency at the Ajaokuta Steel Company Limited and NIOMCO.

Presenting the motion, Senator Akpoti-Uduaghan, said the Ajaokuta Steel Company Limited (ASCI) and the National Iron Ore Mining Company (NIOMCO) located in Kogi State were established sometime in the late 70s by the Federal Government with a potential to put Nigeria on the path of technological and industrial advancement, and establish the country as one of the leading exporters of steel products in the world.

She noted that decades after their establishment, the Ajaoukta Steel Mill and NIOMCO, have remained inoperative and unable to produce steel despite seeming efforts by several administrations due to lack of earnest political will and bureaucratic corruption.

“As at 1994, when the Tyazuromexport (TPE) exited the Ajaokuta Steel Plant on alleged ground that Nigeria did not discharge fully its financial obligation to the TPE, the Ajaokuta Steel Plant was reportedly at 98% completion yet remains inoperative to date,” she said.

The lawmaker also recalled that sometime in 2001, Nigeria’s hope to have the Ajaokuta Steel Plant completed and put into operation was rekindled following the signing of the bilateral agreement between Nigeria and the Russian Federation which was unfortunately diminished following the surreptitious concessioning of NIOMCO and ASCL in June 2003 to unqualified Solgas Energy Limited, a company that lacked both financial and technical expertise as it were uncovered never to be in the business of ore and steel.

“Contrary to the recommendation of the House Committee on Steel in 2004 that Solgas Energy Limited should partner with TPE which has the financial and technical expertise to complete and operate the ASCL and NIOMCO complexes, Solgas Energy Limited instead opted for partnership with another inept company the Global Steel Infrastructure Nigeria Limited (GINL) of India (a.k.a Global Steel Holdings Limited). GINL was alleged to completely run down not only ASCL. and NIOMCO but the Delta Steel Company.

“Upon consideration of the Inuwa Magaji Administrative Panel of Inquiry Report into the GINL’s operations of ASCI, NIOMCO and Delta steel mills, the Federal Executive Council under the leadership of Late President Umaru Yar’Adua, unanimously terminated the Concession Agreement on 2nd April, 2008, citing breach of agreement and unwholesome practices including the fact that the said Concession Agreement was unpatriotically skewed in favor of GINL.

“The House of Representative had in the past investigated the iron and steel sector in Nigeria in 2018 with far reaching resolutions aimed at resuscitating the ASCL and ANIOMCO steel mills but such resolutions were either ignored or are yet to be implemented by the Federal Government.

“The GSHL’s Pramod Mittal is notorious for dublous and questionable business activities with governments of many steel producing countries from the $253m organized economic crimes in India to embezzlement and asset stripping in Bulgaria, Philippines, Libya, Bosnia, Zimbabwe, Montenegro, Serbia and many more.

“While Bosnia arrested and charged GSHL’s Pramod Mittal with organized crime and Bulgaria jailed GSHL’s management staff for economic crimes; Nigeria may have yet again fallen victim to GINL Pramod’s sharp contract fraud in respect of the payout of $496m in 2022. This comes years after a comical re- concessioning of NIOMCO to the same GINL in August 2016. These sadly facilitated by unpatriotic Nigerians occupying trusted government offices.

“Nigeria currently expends about $3.3bn annually on steel imports and quite saddened that a nation blessed with abundant natural ore resources yet plagued by moribund Ajaokuta and Delta steel that have become conduits pipes for diversion of public funds at the expense of Nigerian tax payers,” she stressed

Senator Apoti-Nduaghan maintained that there exists an abnormal management structure at the Ajaokuta Steel Complex whereby a Sole Administrator has unilaterally decided upon the steel mill’s corporate affairs for the past 12 years, adding that “this has further worsened the inefficiency of the moribund company with the recently queried N33 billion electricity debt by President Tinubu.”

In his contribution, Senator Solomon Adeola (APC Ogun West), said salaries and wages of staff of moribund companies are just being paid in billions of naira, stressing the need to reposition the Ajakuta steel company and make it function optimally due to the value it will add to the steel market.

On his part, Senator Sani Musa (APC Niger East), said the Ajakuta steel company has been moved from one fraudulent contractor to another, insisting that the investigation would help unravel so many frauds in the two companies.

Before setting up the investigative panel, Deputy Senate President, Senator Jibrin Barau, who presided over plenary, said the motion would help in bringing more revenue to the government and also help in the irons rots that will help in building infrastructure in the country.

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