The Federal Government announced on Thursday its intention to launch an investigation into the N33 billion in electricity debt accumulated by the inactive Ajaokuta Steel Company Limited (ASCL). The Transmission Company of Nigeria (TCN) had recently disconnected the steel company from the national grid due to its failure to settle the debt.
Following a meeting with President Bola Tinubu at the Aso Rock Villa in Abuja, Minister of Steel Development, Shuaibu Audu, expressed astonishment at how ASCL had accrued such a substantial electricity debt when it was not operating at full capacity. The debt includes N30.85 billion for energy and capacity delivered by Nigerian Bulk Electricity Trading (NBET) and N2.22 billion owed to service providers.
Audu pledged to thoroughly investigate the matter and questioned the high consumption of electricity by a plant not operating at optimal levels. He conveyed his conversation with the Managing Director of Ajaokuta, highlighting the complexity of reviving the steel company in a phased manner.
“Part of what the MD of Ajaokuta told me is that most of the money is in interest payments. And NBET, the electricity company that has disconnected it, is also a government agency,” Audu explained.
The minister emphasized that the government’s commitment to revitalizing Ajaokuta was a gradual process, given its 45-year dormancy. He expressed the need for collaboration, stating, “We need the support of the entire government apparatus; we need the support of stakeholders; we need the support of everyone to be able to do this difficult job.”
Shuaibu Audu also disclosed that President Tinubu had approved the creation of a committee to scout for an appropriate site for a new steel plant in the country. He recounted Tinubu’s engagement with Jindal Steel of India to establish a $5 billion plant, emphasizing the need for an ideal location close to gas stations and abundant natural resources.
In light of the challenging task of reviving Ajaokuta, Audu stressed the necessity for collective support and assistance from government agencies, including NBET, to ensure the success of the project and the creation of jobs for Nigerians.