6 October 2012

Nigeria: Poor Funding, Bane of Steel Sector's Growth

Director-General (DG), National Steel Raw Materials Exploration Agency (NSRMEA), Alex Ohikere has lamented that poor funding was militating against the development of the steel sector in Nigeria

While receiving a delegation of the House Committee on Steel led by its Chairman, Mohammed Asema in Kaduna yesterday, Ohikere said:"We had earlier complained about the low efficiency of our drilling rigs and other equipment, some of which were purchased in the 70s. The maintenance cost of this equipment is enormous"

According to the DG "in the 2012 capital budget, Three Hundred and Ninety Six Million, Eight Hundred and Seventy One Thousand, Five Hundred Naira N396,871,500 only was approved, of which One Hundred and Sixty One Million, Four Hundred and Sixty Two Thousand, Three Hundred and Sixty Two Thousand, Three Hundred and Eighty Nine Naira only had so far been released, which is equivalent to 40.70% budget performance."

He stated that the challenges were being mitigated by government's effort in re-equipping the agency, recalling that two new rigs, including a Messenza drilling rig have been purchased and were currently being used by the agency.

Asema, who spoke passionately on the need to revive the steel sector charged the executive arm of government to revitalise the moribund Ajaokuta Steel Mill, stressing that "except the executives wake up and see the need to invest in the development of steel, Nigeria will only be playing to the gallery"

According to him, "as big as Nigeria is, it cannot boast of a functional steel industry but depends on oil."

Arguing that "there is so much in the solid minerals sector that is not being explored and those exploring it are doing so illegally,Asemadisclosedthat "only $513 million is needed to revive Ajaokuata and make Nigeria stand among the steel producing nations"

The delegation stated that without reviving Ajaokuta Steel, there was no way Nigeria could achieve Vision 20:2020, adding that "as soon as Ajaokuta can work, all related agencies will find their feet."

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