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Government commits to resuscitating decades-old steel plant
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Mining companies warned to finalise community development agreements or face sanctions
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Ministry stresses adherence to ESG standards and transparency in operations
The federal government has rejected claims that the Ajaokuta Steel Company Limited (ASCL) is beyond revitalisation, insisting it remains committed to restoring the nearly five-decade-old plant to productive use.
Minister of Solid Minerals Development, Dr Dele Alake, also directed mining and quarrying companies licensed by the Nigerian Mining Cadastral Office (MCO) since 2024 to conclude Community Development Agreements (CDAs) with host communities by 31 December 2025.
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Dr Alake revealed that only 24 CDAs were signed in the first half of the year despite 74 new mineral titles being issued.
Highlighting the compliance gap, he noted that in 2023 alone, the MCO granted 960 Small Scale Mining Licences, 391 Quarry Licences, and 37 Mining Leases, all legally required to engage host communities before commencing operations.
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“Responsible mining under this administration demands adherence to international Environmental, Social, and Governance (ESG) standards. No company will extract minerals without first signing agreements and committing to community development projects,” Dr Alake said.
On Ajaokuta Steel, the Ministry of Steel Development stated that a new technical and financial audit is underway to guide transparent, data-driven decisions on the plant’s future. The 2018 audit had deemed the plant structurally sound, recommending automation of manual systems for efficiency improvements.
“The federal government remains firmly committed to developing Nigeria’s steel sector. The updated audit will provide a sound basis for decisive action,” the Ministry said.
Started in 1979, Ajaokuta Steel has never produced steel commercially due to mismanagement, political interference, funding shortfalls, and failed concessions.
The government emphasised that the revival aims to build a competitive steel industry supporting national industrialisation and infrastructure growth.
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Dr Alake further warned that companies failing to comply with CDA requirements risk licence revocation and reparations for unlawfully extracted resources. He urged communities to assemble capable negotiation teams and cautioned leaders against soliciting personal inducements or approving substandard contractors.
The Ministry commended the Mines Environmental Compliance Department for closing three companies last month over CDA delays, sending a clear message that “it is no longer business as usual.”
