FG Confident of Ajaokuta Deal by End of 2026
The Federal Government has assured that a definitive agreement with a Chinese company for the revival of the Ajaokuta Steel Company will be concluded and signed before the end of 2026.
This assurance was provided by the Minister of Steel Development, Sha’ibu Abubakar Audu, during his appearance on the NTA Network programme Good Morning Nigeria. He emphasized the steel sector's critical role as the backbone of industrialisation for any serious economy.
Minister Audu stated that the Tinubu administration has prioritized securing credible technical and financial partners for Ajaokuta Steel. He confirmed that discussions with a particular Chinese investor have reached an advanced stage.
$1.5 Billion Investment Sought, Key Partnerships Formed
The government is actively seeking private investment for the Ajaokuta Steel Company, acknowledging that it cannot solely fund the estimated $1.5 billion to $2 billion required for its revival. The minister highlighted the need for a partner with robust financial capacity, a proven execution record, and technical expertise.
Audu noted that Ajaokuta Steel, established in 1979, has not produced any sheet of liquid steel since its inception. He reiterated the administration's commitment over the last three years to engage serious partners and secure funding for its resuscitation.
In a strategic move, the Ministry of Steel Development and Ajaokuta Steel have signed a Memorandum of Understanding (MoU) with the Ministry of Defence and the Defence Industries Corporation of Nigeria (DICON). This MoU aims to manufacture military hardware, including rifles, ballistic vests, and helmets, at the steel complex's engineering workshop.
Addressing Decades of Inactivity and Funding Challenges
Several initiatives are already underway to prepare Ajaokuta Steel for its revival, including a technical audit, gas infrastructure development, and strategic partnerships. The procurement process for the technical audit has been completed, with an assessment of the plant's facilities already in progress to identify rehabilitation and upgrade needs.
The Ministry of Steel Development, in collaboration with NNPC, has commenced the development of five mini-LNG plants within the Ajaokuta Steel complex. This project is attracting approximately $500 million in foreign direct investment to support industrial gas supply in northern Nigeria.
Furthermore, Ajaokuta Steel recently signed a 20-year Gas Sale and Purchase Agreement with NNPC, ensuring a long-term gas supply for the facility. These measures are designed to position the steel plant for sustainable operations once the investment agreement is finalized.
Despite remaining non-operational for over four decades, Ajaokuta Steel continues to receive significant budgetary allocations from the Federal Government. Nairametrics reported in January 2026 that the Federal Government proposed N6.69 billion for Ajaokuta Steel Company Limited in the 2026 Appropriation Bill.
Of this total allocation, N6.04 billion, representing about 90.4%, was earmarked for personnel costs. This highlights the longstanding challenge of sustaining a non-producing public enterprise while efforts continue to attract private investment for its revival.
