The Senate on Tuesday constituted a 10-member ad hoc committee to ascertain the reasons behind the moribund state of the Ajaokuta Steel Company and the National Ore Mining Company (NIOMCO) despite the alleged payment of $496 million to contractors between 2008 and now.
The Deputy Senate President, Barau Jibrin, who presided over the plenary announced the composition of the committee.
The resolution to set up the panel followed the adoption of a motion sponsored by the Kogi Central senator, Natasha Akpoti-Uduaghan.
The committee is chaired by the senator representing Ondo Central Senatorial District, Adeniyi Adegbonmire, while Suleiman Kawu, the senator for Kano South, will serve as deputy chairman.
Members of the committee are Mrs Akpoti-Uduaghan (PDP, Kogi Central), Onawo Mohamed (PDP, Nasarawa South), Joel Ewomazino (PDP, Delta South) and Onyesoh Heacho (PDP, Rivers East).
Others are Abdullahi Yahaya (PDP, Kebbi North), Patrick Ndubueze (APC, Imo North), Tokunbo Abiru (APC, Lagos East) and Osita Ngwu (PDP, Enugu West).
Mr Jibrin directed the committee to report their findings to the senate for debate and adoption within two weeks.
Motion
Mrs Akpoti-Uduaghan, while presenting the motion, identified ‘political will’ and ‘bureaucratic corruption’ as major factors that contributed to the moribund state of the Ajaokuta Steel Company.
She said the investigation would uncover the circumstances that led to the re-concession of NIOMCO.
The senator asked the upper chamber to probe the payment of $496m allegedly made to the Chairman, Global Infrastructure Holdings Ltd (GINL) by the federal government in September 2022 as a settlement over ASL contractual disputes.
According to her, Ajaokuta Steel and NIOMCO were set up by the federal government in the late 70s to establish Nigeria as a leading steel exporter but have been inoperative for decades due to a lack of political will and bureaucratic corruption.
She explained that in 1994 when Tyazhpromexport (TPE) exited the Ajaokuta Steel on the alleged ground that Nigeria did not discharge fully its financial obligation to the TPE, the Ajaokuta Steel was reportedly at 98% completion yet remains inoperative to date.
“After reviewing the Inuwa Magaji Administrative Panel of Inquiry Report on the late President Umaru Yar’adua, the Federal Executive Council unanimously terminated the Concession Agreement on April 2, 2008. The termination was due to the operations of ASCL, NIOMCO, and Delta Steel Mills, as well as a breach of agreement and unwholesome practices. Additionally, the Concession Agreement was found to be unpatriotically skewed in favour of GINL.
“The House of Representatives had conducted an investigation into the Iron and Steel Sector in 2018 with far-reaching resolutions aimed at resuscitating the ASCL and NIOMCO steel mills. However, the federal government either ignored these resolutions or has not implemented them yet. Many steel-producing countries are disturbed by the $253 million organised economic crimes in India. Additionally, GSHL’s Pramod Mittal is notorious for engaging in questionable business activities such as embezzlement and asset-stripping in countries like Bulgaria, the Philippines, Libya, Bosnia, Zimbabwe, Montenegro, Serbia, and many more.
“In Bosnia, Pramod Mittal, who is associated with GSHL, was arrested and charged with organised crime. Additionally, GSHL’s management staff were jailed for economic crimes. However, it seems that Nigeria has fallen victim to Pramod’s sharp contract fraud yet again, in relation to the payout of $496m in 2022. This is not the first time, as Nigeria previously conceded NIOMCO to the same GINL in August 2016. Unfortunately, these fraudulent activities are facilitated by unpatriotic Nigerians who hold trusted government positions.
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“It is disheartening to note that Nigeria is currently spending approximately $3.3 billion annually on importing steel despite having abundant natural ore resources. This is because the Ajaokuta and Delta steel plants, which could have served as valuable assets to the nation, are in a state of disrepair. These plants have become channels for the misappropriation of public funds, which is a huge burden on Nigerian taxpayers.
“I am concerned about the management structure at the Ajaokuta Steel Complex. It appears that a Sole Administrator has been making all decisions regarding the company’s affairs for the past 12 years without any input from others. This has led to increased inefficiencies at the company. Recently, President Tinubu has questioned the 33 billion naira electricity debt,” she said.
Following the motion, the Senate resolved to invite and interface with relevant Ministries Departments and Agencies (MDAs) of the federal government and other stakeholders involved in the steel sector to find lasting solutions to the issue.
Contributing to the motion, the Ogun West senàtor, Olamilekan Adeola, complained that salaries and wages of staff of the moribund companies are paid in dollars.
Mr Adeola said there is a need to reposition the Ajaokuta Steel and make it functional.
Sani Musa, the senator for Niger East, also said the Ajaokuta Steel has been non-functional for several years despite the huge funds allocated to it.
The senators voted overwhelmingly for the motion when it was put to vote by the presiding deputy senate president.
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