ALSCON set to reopen as NA places Ajaokuta concession on hold

The Aluminium Smelter Company of Nigeria ( ALSCON) will soon re- open as issues around the company have been resolved, Ime Ekrikpo, director of ferrous metals at the Federal Ministry of Mines and Steel Development, said.

Ekrikpo said this at the annual general meeting of the Basic Metal, Iron and Steel Group of the Manufacturers Association of Nigeria (MAN) in Lagos.

He explained that after several years of leaving ALSCON in limbo, the National Council on Privatisation ( NCP) engaged the parties involved and returned the facility to UC RUSAL.

He said the Bureau of Public Enterprises (BPE) is monitoring the process of restart of the smelter company as technical audit has been conducted while the phase-wise rehabilitation of the plant is ongoing.

Regarding Ajaokuta Steel, he said the federal government considered the option of concession whereby it would maintain some level of ownership while being funded and operated by a private player.

He further said the procurement processes to engage

a transaction adviser is on hold following its delisting from the list of enterprises to be privatised by the National Assembly.

Businessday had criticised the immediate past Senate for insisting on setting aside $1 billion for the steel plant. This is because it makes more economic sense to sell or concession the plant which has gulped over $8 billion without producing a sheet of steel.

On the way forward, he advised that the pending Nigerian Metallurgical Industry Bill sitting in the National Assembly be passed into law to ensure adequate legal and regulatory framework to guide the metallurgical industry.

“Government commits to supporting genuine investors in the mines and steel industry with virile and sustainable enabling environment through articulate policies, provision of legal and regulatory framework as well as attractive investment incentives to industry players,” he said.

Oluyinka Kufile, outgone chairman, Basic Metal, Iron and Steel, said the convulsing status of Ajaokuta Steel Complex has not helped the condition of struggling Nigerian manufacturers as most basic raw materials for steel industry, such production of iron ore and billets, are not being produced by the company.

“Consequently, the industry engages more in downstream light transformation with moribund mining, beneficiation and rolling operations,” he said.

He pointed out that the Aluminum Smelting plant in Ikot Abasi, which had 190,000 metric tons capacity at inception, was established to produce aluminum ingots but is not doing so.

Unfortunately, he said, the company has been unable to produce more than 30,000 tons, adding that the failure to effectively manage capitalintensive industries has made Nigeria still depending on importation of machinery and spare parts.

“We are therefore of the opinion that the manner and persistence of the current challenges of non-patronage and importation of all manners of steel and aluminium products for infrastructure projects and upgrade across the country could initiate and are capable of exiting the majority of our members and may consequently spell doom for the industry,” he warned.

He advocated government monitoring of the implementation of the Executive Order 003 and 005 to ensure that that both public and private companies in the construction industry comply with local patronage and local content in all their projects, where such products and contents are locally available.

“Unrestricted access to government for concessions/ waivers should be discontinued,” he said.

“Members’ requests should be channelled through the umbrella of MAN, which has structured sectorial arrangement for such. In addition, protection should be accorded to all member-companies in the Basic Metal and, Steel and Aluminum Group irrespective of their scale of operation and value addition.”

Kamorudeen Yusuf, newly elected chairman of Basic Metal, Iron and Steel, said he believes the federal government is determined to revive the steel industry.

He lamented that genuine investors in the country pay import tariffs to the government while smugglers flood the market with substandard goods without paying any duty.

He admitted that the Central Bank of Nigeria (CBN) makes foreign exchange available for manufacturers and supports them in many ways, but warned that nothing would be achieved when smuggling is rife.

He urged the Standards Organisation of Nigeria (SON) to stop allowing substandard steel products into the local market.

“A situation where the SON says products should not be less than 0.15mm but some flood the market with products with less than 0.12mm calls for concern,” he said.

He stressed the need to plug such leakages to save multi- billion naira investments in the country.

He pledged that he would do everything within his powers to raise the status of the steel sector in the country.