Kalu Aja exposè on Ajaokuta Steel uncensored

No Nigerian can visit Ajaokuta Steel Company ASC, see investments of more than $8b rotting in the African sun and not cry. i went there, I cried. what exactly is the problem? if I have written severally on this topic, but today let me do a comprehensive post.

Ajaokuta Steel Company is massive, she has 68km road network, 24 housing estates on the project. Some of the estates have over 1,000 homes, a seaport, a 110mw power generation plant, there are 43 separate plants in Ajaokuta alone. It is estimated that if Ajaokuta becomes operational, it will create 500,000 jobs.https://etimes.com.ng/why-ajaokuta-steel-and-why-nigeria-cant-produce-steel-for-now/

There is no industrialized nation on earth that does not have a steel sector it’s that simple. A report by the Central Bank of Nigeria shows that Nigeria currently imports steel, aluminum products and associated derivatives of approximately 25 metric tonnes per annum estimated at $4.5bn, this figure will continue to rise, and the Nigerian economy continues to expand. Ajaokuta is an integrated steel company, it was designed by the Russian to be self-sufficient to get all its inputs from Nigeria and make steel. Ajaokuta strength is also its weakness, Ajaokuta can only work with all inputs available.



this will be a slightly technical post, but please try and follow.



Steel is an alloy of iron and carbon amongst other things, iron is the base metal in steel, to make steel, you need Iron Ore, Coke from Coal, Limestone as main components. these components are mixed in a blast furnace to produce liquid steel which can be long steel for rail lines or flat steel for automobile making etc

To give a simple example, look at steel as making jollof rice, iron ore is the rice, the limestone and coke are the pepper and salt the pot is the blast furnace. At a steel plane the blast furnace is ONLY turned on when the steel company is ready to make steel. Blast furnaces operate continuously and are never shut down. The raw material to be fed into the furnace is divided into several small charges that are introduced into the furnace at 10- to 15-min intervals. this means everything must be in place BEFORE the blast furnace is turned on, the iron ore, the coal, the limestone, everything, why? Because you do not switch off a blast furnace for another 10 years or however its campaign life is.



Nigeria has blessed with all the major raw materials needed to produce steel including iron ore in Kogi, coal and limestone in Enugu.

Nigerian iron has very low iron concentration. Agbaja has the largest iron ore deposit in Nigeria with about 2 billion tonnes but the Agbaja iron ore has a high phosphate content. Phosphate can cause brittleness in steel making it to fracture, thus Agbaga was abandoned for Itakpe. Itakpe iron ore has no issues with phosphate but has low iron content, thus to make steel with Nigeria iron ore, a process called “beneficiation” has to be done to process the Itakpe ores to raise its iron content to meet the required standard for steel production.

Coal? Most of the coal found in Nigeria is non-coking, thus, unsuitable for steel production. coal deposits in Enugu, have no impurities but are non-coking. The good news? Nigeria has abundant deposit of limestone and we have natural gas to provide power



So back to Ajaokuta, what really happened? why can Nigeria not make steel anytime soon? let’s link up the elements

Policy Failure: The Ajaokuta contract was signed between the Nigerian government and the Soviet state-owned company, Tiajpromexport (TPE) the company was scheduled for completion in 1986. In 2012, the Federal Government launched her backward integration policy. Going forward import licenses for steel products was only granted to companies producing steel locally. TPE to ensure they could import steel parts for Ajaokuta simply went ahead and built the rolling mills in Ajaokuta before the actual steel plant was completed, they imported billet from Ukraine to accomplish this. Thus, Ajaokuta was producing steel before the actual steel plant was started. Thus, amazingly Ajaokuta has a functional rolling mills but no operational blast furnace, Ajaokuta cannot produce steel from basic iron ore found in Nigeria in her blast furnace.…this is the definition of cart before the horse.

https://etimes.com.ng/why-ajaokuta-steel-and-why-nigeria-cant-produce-steel-for-now/

NIOMCO Factor: The iron ore in Nigeria earmarked for Ajaokuta is from Itakpe, it has low iron content thus the FG built National Iron Ore Mining Company (NIOMCO) a 2.15 metric tonnes beneficiation plant designed to process the low-quality iron ore from Itakpe to iron ore suitable for Ajaokuta Steel. Simply put, if NIOMCO does not operate, Ajaokuta CANNOT operate (unless Ajaokuta uses imported iron ore.) as at today, June 17th 2018, NIOMCO is not operational





Railway: 15m tonnes of iron ore cannot be moved by road, as it will destroy the roads, thus a railway was to be built from Itakpe to Ajaokuta to take iron ore from the beneficiation plan in Itakpe to the Ajaokuta. The. Itakpe to Ajaokuta by rail is just 52km, the rail line was to be delivered by March 2019, but the Minister of Transportation Rotimi Amaechi revised the delivery date to June 2018 and converted the purely commercial railway to also carry human passengers. These changes meant the cost of the project and delivery dates had to change as passenger wagons and train stations had to be built. To achieve this, 12 new passenger stations and 12 access roads had to be designed and built. The Itakpe to Ajaokuta (IA) has two stations. As at June 2018, The station IA1 – Eganyi to Itakpe, is still under design. Station AW1 – Ajaokuta (standard station) (zero per cent work done). Thus the railways are not functional


https://etimes.com.ng/why-ajaokuta-steel-and-why-nigeria-cant-produce-steel-for-now/
Blast Furnace: The furnace in Ajaokuta is the heart of Ajaokuta, it is the pot where the jollof rice will be cooked, however it has never been turned on, why? because there has never been any time Ajaokuta has had raw materials available to ensure continuous day in day out production for 5 years. Why has there never been materials? Because there is no rail way to take iron ore from Itakpe to Ajaokuta. Why is there no railway from Itakpe to Ajaokuta? Because NIOMCO in Itakpe is moribund and no functional and cannot convert Nigeria iron ore to high grade ore for the furnace in Ajaokuta.



So, it follows that for Ajaokuta to work, we MUST have three key critical paths



NIOMCO must be functionalItakpe to Ajaokuta Railway line must be functionalBlast Furnace operational

All three are not functional, so its clear Nigeria cannot make steel in Ajaokuta. Nothing however stops a corrupt government official from importing billets and running them in the rolling mills to deceive tax payers. So, when anyone tells you Ajaokuta will soon work ask them, can a steel plant work without NIOMCO, railways and a blast furnace?



All is not gloom, Kayode Fayemi as Minister was able to secure an out of court about Ajaokuta, we must build on this



In closing, Ajaokuta is the only steel plant in the world built by the USSR, sold to Americans, then to Indians, all these teams have come and gone with their own technical style, there have even been accusations of asset stripping by the Indians.



So why this post? because I am a patriot, I will not sit by and watch scarce resources be wasted in a grand deceit. Probably some corrupt folks have told Mr President that Ajaokuta can produce economically viable steel if “small” dollars are spent. You can already see how the critical rail line delivery dates was moved back to ensure it is done in time for 2019 elections, yet it is still in design stage. Ajaokuta is Nigeria and probably Africa biggest failure. It has failed. Can it be made to work yes but the cost to integrate Ajaokuta with her mines and rails can be used to build new smaller modern turn key functional steel mills. The government should get out of Ajaokuta, sell the place and allows the private sector capital and expertise restructure and own it.

https://etimes.com.ng/why-ajaokuta-steel-and-why-nigeria-cant-produce-steel-for-now/

If you want to make jollof rice and there is no rice the solution is not to keep boiling water without rice but to go and get rice.

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Nice write up

What is the relationship between DSC Aladja and Ajaokuta? Is there is a railway line from Aladja to Ajaokuta?

Hmmm

Buhari has failed to keep his campaign promise of reviving ajaokuta steel just like he has failed in every other campaign promises made.

otokx:
Nice write up

What is the relationship between DSC Aladja and Ajaokuta? Is there is a railway line from Aladja to Ajaokuta?

There used to be a steel company in delta state called the delta steel company run by indians it is no longer functional now tho but has nothing to do with Ajaokuta

A well researched article. Thank you patriot

When shall we get it right in this country?

Ghostgambler:


There used to be a steel company in delta state called the delta steel company run by indians it is no longer functional now tho but has nothing to do with Ajaokuta

steel, aluminium, crude:
3 extracts that should have made us a world power 20 yrs ago, or sooner.
yet, facilities are abandoned.
and all of them were staffed by supposedly competent Nigerians-
I hear that some of the best brains in the land worked in these places…

u c y we, the educated ones are the curse of this country?
what greater treachery, than leaving your ouwn children's future to rot?
all parents above 60 yrs should be flogged everyday.

And someone said Nigerian youths are lazy.

This incisive write up was written by a youth. A good expose, showing clearly that the ruse about ASC coming back to life was a mere propaganda towards 2019

Haba bubu.....haba

Politicians bad They never mentioned all these constraints rather they prefer playing politics with the whole thing.

This article was written by an Igbo man , no time , most igbos will tell u the truth.

One Mod will not take this to FP now...

If It is useless thing like Davido and chioma, Tiwa salvage'spictures, backside of lady and baby mamas news they will take it to front page.


Some people are just brainless inside professionalism.

Pls Mr. Seun, you need to sack some mods here because they don't know what to take to FP. Just bring in new mods and they will do the job perfectly with less pay.

Stop whining and simply summon lala. Hes not an omniscient or omnipresent. He's usually good about pushing topics to front page especially if thread is hot.

Front Page: Lalasticlala

EdoBoy90:
One Mod will not take this to FP now...


Some people are just brainless inside professionalism.

Pls Mr. Seun, you need to sack some mods here because they don't know what to take to FP. Just bring in new mods and they will do the job perfectly with less pay.

The conclusion of the write up made it look sponsored. Nice write up though but I also wish to hear from those who think spending more on Ajaokuta steel company will make it viable.

Buhari and his gang of liars are already telling us how "Ajaokuta has roared back to life after 40yrs?

Many officials of this govt deserve to be tied and shot dead before they kill us with lies

This great write up should be moved to the front page ASAP. Let's take a break from stupid celebrity gossip that does nothing but render people intellectually impotent.

The government should simply sell off the plant and let private sector work or just continue concession. The iron ore isssue he mentioned is critical but not impossible to work around.The imported iron problem could be sold by simply giving the steel plant EPZ status. Our neighbor in west Africa exports plenty of Iron ore.

How exactly to get ore to plant is the question. The basker case NRC is ginding it difficult to supply rail carts for Kaduna dry port. This project would be much bigger.

Ghostgambler:


There used to be a steel company in delta state called the delta steel company run by indians it is no longer functional now tho but has nothing to do with Ajaokuta

Why was the plant sited at Ajaokuta, far from the raw materials?

It doesn't make sense. Sitting the plant 54km away from NIOMCO is madness and pure useless politics I guess.

Amucha:
The conclusion of the write up made it look sponsored. Nice write up though but I also wish to hear from those who think spending more on Ajaokuta steel company will make it viable.

The products from that plant will sell at exorbitant price beyond the reach of even the foreign market. The plant is not economical. The cost of steel production will be extremely high.

Ghostgambler:


There used to be a steel company in delta state called the delta steel company run by indians it is no longer functional now tho but has nothing to do with Ajaokuta

Aladja was concessioned to the Indians by Obj. Aladja was built in anticipation of Ajaokuta emergence, they were suppose to be its subsidiaries, same with Osogbo steel rolling mill and machine tools. Failure of Ajaokuta made those companies that would have transformed our country and continent to a scrap recycle companies. Unfortunately, most Nigerians especially those that have led the steel and power ministries including the last minister have no knowledge of the synergy between steel and national development and security.

Blue3k:
The government should simply sell off the plant and let private sector work or just continue concession. The iron ore isssue he mentioned is critical but not impossible to work around.The imported iron problem could be sold by simply giving the steel plant EPZ status. Our neighbor in west Africa exports plenty of Iron ore.

How exactly to get ore to plant is the question. The basker case NRC is ginding it difficult to supply rail carts for Kaduna dry port. This project would be much bigger.

Steel deals are not like oil refining or brewery business. Have ou ever asked why Donald trump continue to fight Chinese and European steels? even Canadian steels. Other countries will only buy your steel plant to make it moribund...they will mobilize international partners against it in such a way to stop it from working through litigation in the event you want them out...that's what Ajaokuta and Itakpe has been dealing with for a while now. You need a strong leader with a disruptive tendency and confrontational attorney general to do that. Unfortunately, Buhari appointed a guy that is only interested in returning as a governor to head the ministry, and most of his activities in recent years have been counter productive and have eroded some of the progress made since Yar Adua era. The attorney general only only confrontational on matters that concern Fulanis, while the VP is to legalistic to be disruptive. Buhari himself seem sick and look delusional. I wish Buhari can just support a more dynamic and ambitious candidate in 2019 instead of wasting another 4 years with his gang of clowns.

Ghostgambler:


There used to be a steel company in delta state called the delta steel company run by indians it is no longer functional now tho but has nothing to do with Ajaokuta

DSC is very functional and was setup initially as an offshoot to Ajaokuta. However its closeness to Warri enables it to process and ship out.

transformed:
Steel deals are not like oil refining or brewery business. Have uou ever asked why Donald trump continue to fight Chinese and European steels? even Canadian steels. Other countries will only buy your steel plant to make it moribund...they will mobilize international partners against it in such a way to stop it from working through litigation in the event you want them out...that's what Ajaokuta and Itakpe has been dealing with for a while now.

Trump has protectionist tendancies. THr china issue is they use unfair subsidies wirh state owned cooperations. Ajokuta never worked not because of some international conspiracy avsimst Nigeria it because if government ineptitude. Its the same case with ALSCON. The Nigerian government always violates the terms them loses in court. Even in the governments time line if events this shown.

If there are security imterst the senate or execustive csn move to block sale. They should be investigating the buyers anyway. DSC now renamed Premium Steels & Mines is working.

Ghostgambler:


There used to be a steel company in delta state called the delta steel company run by indians it is no longer functional now tho but has nothing to do with Ajaokuta

It is still functional. It has some connection to Ajaokuta. Both the Delta steel and the one at Osogbo were established with reference to Ajaokuta.

jusRadical:



Why was the plant sited at Ajaokuta, far from the raw materials?

It doesn't make sense. Sitting the plant 54km away from NIOMCO is madness and pure useless politics I guess.

Which politics?

Lol this thread died out quick. The front page wouodnt change that fact. It'll just be one of those threads that bearly eaks out 2 pages.

Does anyone know what's needed to get this plant back online. The author didn't give a monetary amount. This seems like another zombie company governments budgets noney to maintain with nothing of interest going on. Lastly the train opperation date keeps shifting 2019 or later is when im expecting it.

Personally I have bo hope in government getting job done. Its the FG fault these plants don't work. Im just wondering if NASS is serious about not allowing it to be concessioned or sold by FG. That bill made it's 1st reading with veto proof majority in house. Lets see if the can keeo that same energy in both houses.

National Iron Ore Mining Company (NIOMCO) a 2.15 metric tonnes beneficiation plant designed to process the low-quality iron ore from Itakpe to iron ore suitable for Ajaokuta Steel. Simply put, if NIOMCO does not operate, Ajaokuta CANNOT operate (unless Ajaokuta uses imported iron ore.) as at today, June 17th 2018, NIOMCO is not operational

Such a big shame we had previous governments who couldn't see beyond their noses and fix this great investment for the progress and development of this country in the area of massive steel production which would have made us a Giant in the production of steels and it's by products to the global market. Unfortunately, a lying government came onboard promising heaven on earth through the revamping of this great investment and up till date, we are yet to see anything working. Shame on previous governments and biggest shame on the Buhari's kleptomanic government of empty boasters.

Blue3k:
Lol this thread died out quick. The front page wouodnt change that fact. It'll just be one of those threads that bearly eaks out 2 pages.

Does anyone know what's needed to get this plant back online. The author didn't give a monetary amount. This seems like another zombie company governments budgets noney to maintain with nothing of interest going on. Lastly the train opperation date keeps shifting 2019 or later is when im expecting it.

Personally I have bo hope in government getting job done. Its the FG fault these plants don't work. Im just wondering if NASS is serious about not allowing it to be concessioned or sold by FG. That bill made it's 2st reading with veto proof majority in house. Lets see if the can keeo that same energy in both houses.

This Mumu government of Buhari actually voted or projected an $8 billion estimate to bring the steel plant back to life but up till date, no show

Ajaokuta was mismanaged by successive governments, reason why it is where it is today. I addition, I feel that mill is beyond redemption as it is obsolete. Ot would be alot more beneficial and cost saving building a new one with current technologies.

A steel company alone has the potential of turning around the entire economy of a nation.

Shame on our government