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Transportation, major problem of Ajaokuta Steel company

23 December 2014, 11:31

Abuja - Lack of logistics to move raw materials to Ajaokuta Steel Company has been identified as a major problem facing the plant

Musa Sada, the Minister of Mines and Steel Development, made this known at Ministerial Platform 2014 in Abuja on Monday.

He said being an integrated steel company; it required a lot of logistics to transport raw materials to the plant.

Sada said the concept of Ajaokuta was to produce 1.3 million tonnes of steel annually in the first, 2.6 in the second, and 5.2 in the third phases respectively.

“Now let us look at the first phase of 1.3 million tonnes. For you to produce 1.3 million tonnes of steel, you need to transport materials six times that volume.”

“So, you can imagine the amount of materials you have to move up and down. But unfortunately these infrastructure like the railways and the rail limbs have not been developed,” he said.

The minister said that this had become a big problem in the development of the steel sector.

Sada, however, said the present administration had made efforts to address the challenges.

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According to him, a lot of units like the power plant, the rolling mills, the lime plants, the engineering works and the metallurgical training centre have been completed.

Sada said that all the units completed had been operational at one time or other.

He said raw materials like iron ore, cooking coal, limestone, dolomite and bauxite needed to produce steel, were in many parts of the country.

The minister said the Federal Government had set up a committee to look at the infrastructure requirements of the country.

“Most of these have been incorporated in the infrastructure master plan. The government has been tackling some of the problems, like the railways.”

He said the ministry was collaborating with Bureau of Public Enterprises to ensure that the privatised steel rolling mills began operation soon.

He said the ministry had established a data base on steel production and operating companies to enhance policy formulation.

He identified challenges facing the ministry as lack of legal and regulatory frameworks for the steel sector, illegal mining, smuggling of minerals and inadequate skilled manpower.

Others are inadequate funding of the sector, low level of geosciences information for investment and inadequate mine site infrastructure to facilitate mineral resource development, among others.


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