FG Earmarks 6bn Intervention Fund for Mining Sector

As part of post COVID-19 intervention, the Minister of Mines and Steel Development, Mr. Olamilenka Adegbite, yesterday in Abuja disclosed that the federal government has earmarked the sum of N600 billion out of N2.3 trillion to be release by the government to ministries to cushion the effect of the pandemic on the economy.

Adegbite revealed that the exact figure the ministry was getting from the 2.3trilion intervention fund is “just N6billion, but our sector is also opportune to take money from the natural resources intervention funds made for the sector, which is also accessible to the water resources sector because what we requested for was more than that.”

The minister also informed journalists that the Nigerian Government would not spend any money on Ajoakuta anymore, adding, that the project was making a business case

In an interactive session with selected media houses in Abuja, he noted that: “President Muhammadu Buhari has stated that the government will not spend any money on Ajoakuta again, so Ajoakuta is making a business case which has been accepted, and once it is resuscitated and producing, it can pay back its loan. So the whole essence is that they will build and operate it for a while upon agreed terms, and at the end of the term when the loan is paid with interest, the plant will be reverted back to Nigeria, and at that time, a decision will be taken on who will manage it.”

He stressed that essentially the project on the collaboration with Ajoakuta is the build, use, operate and transfer with the Russian Government, noting: “President Buhari and President Vladimir Putin sat together at a bilateral meeting and agreed on a government-to-government cooperation to resuscitate Ajoakuta because the Russians built Ajoakuta when they were the Soviet Union in collaboration with the Ukrainians, and that is why we have gone back to them. The whole essence is for them to come here, access the plant and the job to be done, which is what we call a technical audit. The Russian Government will nominate a contractor who will do the job.”

The minister added: “The funding is coming from two sources, the Russian Export Centre, which is a Russian sort of Nexim Bank. They are providing $450million for the project, while the Afrexim bank will provide $1billion. So we have a total of $1.45billion but the whole essence is that the Russian technical experts will come and do the audit which will lead to them giving us an exact figure of how much it will cost to resuscitate Ajoakuta and the National Iron Ore Mining Company (NIOMCO)-the two are tied together-and once this is done, of course there will be negotiations, a sum will be agreed and a contract will be formed and that is the basis on which we will proceed.”