Africa (Commonwealth Union) _ Nigeria’s Minister of Solid Minerals Development, Dr. Oladele Alake, has lauded a new $1 billion (₦1.6 trillion) iron ore to steel project planned for Kogi State, describing it as a significant advancement in the government’s drive to prioritize local value addition in the solid minerals sector. This ambitious project, led by Chart and Capstone Integrated Limited of Nigeria and China’s Sinomach-He, aligns with the Federal Government’s vision of developing Nigeria’s mining sector through local processing and job creation.
Speaking to the project promoters during President Bola Ahmed Tinubu’s recent visit to Beijing, Alake reaffirmed the government’s commitment to collaborate closely with them to ensure timely completion. According to a statement from Kehinde Bamigbetan, the Minister’s Special Adviser, Alake emphasized that the Federal Government has shifted away from the previous “pit-to-port” policy, which allowed raw mineral exports without local processing. This new approach requires mining companies to focus on local value addition, thereby creating jobs, transferring skills, and improving Nigeria’s trade balance.
To enforce this policy shift, Alake announced that future mining license applicants must present plans for local processing as a condition for approval. “The trade balance between Nigeria and China currently favors China by over one billion dollars because Nigeria exports mostly raw minerals,” he noted. “By exporting processed or semi-processed minerals, Nigeria can improve its trade balance, increase foreign exchange earnings, and potentially reduce its debt burden in the near future.”
Chief Abel Edijala, CEO of Chart and Capstone Integrated Limited, presented the Memorandum of Understanding (MoU) for the project and praised the streamlined licensing process introduced by Alake. Edijala noted that their exploration license was granted without bureaucratic delays or corruption, underscoring the efficiency and fairness of the new system.
Edijala outlined the project’s model, which involves feeding iron ore directly from the mining site to a steel manufacturing plant, aiming to support Nigeria’s industrialization efforts. He also requested tax waivers for equipment imports and tax holidays during the project’s initial phase to mitigate macroeconomic fluctuations.
Hou Encai, Vice Manager of Sinomach-He, confirmed the company’s readiness to begin the project. Established in 1958, the state-owned Chinese company employs over 15,000 people, including 2,000 engineers, and supplies 80% of China’s steel needs. Encai highlighted Sinomach-He’s extensive experience in mining, steel production, and infrastructure development. As per the MoU, Sinomach-He will act as the master contractor, handling engineering, procurement, installation, commissioning, and training.
The meeting also included key stakeholders such as Professor He Lixiong from the China Association of Small and Medium Enterprises, Mr. Innocent Okonkwo from the Belt and Road Africa Economic Initiative, and Nigerian officials. Nigeria’s Consul-General to China, Ambassador Gbadebo Afolabi, confirmed Sinomach-He’s credibility after the embassy’s thorough due diligence.
The project is poised to transform Nigeria’s steel industry, enhance local capacity, and strengthen economic ties with China, marking a new chapter in the country’s solid minerals development strategy.
