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Importance of Ajaokuta to The Industrialization of Nigeria

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The steel producing industry is said to be the bedrock of good economy for any nation. Ajaokuta Steel company is supposed to be the turning point of Nigeria’s economy. However, it seems like an unachieved dream. Nigeria is said to be among the top 20 countries with iron ore used to make steel, yet we are not on the list of the top steelmaking countries. The problems faced in achieving this dream includes Corruption in the Nigerian government, international conspiracy and the employment factors. These problems have dragged the economy of the nation and has contributed to the high crime rate and poverty levels. In the next pages, you will find an extended overview and history of Ajaokuta and the solutions I am suggesting to some of the problems. I hope you would be delighted to read and gain knowledge.

Brief History And Overview Of Ajaokuta

Having a steel industry was conceptioned by the central government in 1958. In any case, due to the developing attention to the accessibility of iron mineral in Agbaja, Udi and different zones of the nation, there was an agreement to set up a coordinated steel plant. Late Tafawa Balewa and Late Nnamdi Azikiwe between 1960 – 1966 welcomed and got a proposition from some remote firms, including those from the UK, U. S. , Germany and Canada, the greater part of these being on the plausibility of setting up steel plants. The endeavours of the administration did not yield critical positive outcome since they depended on the utilization of iron deposits in Agbaja and Udi which were later observed by the foreign contractors to be unsatisfactory for coordinate decrease. In 1967, a group of Soviet specialists arrived in Nigeria to direct the scouting for the availability of an iron and steel plant, as a follow-up on a specialized/monetary participation pact between the administrations of Nigeria and the USSR. In their report, they prescribed the utilization of blast furnace procedure of iron making. The report additionally brought up that the known iron metal deposits in the nation were of low quality and suggested that further geographical studies be done to check whether better mineral could be found. In 1968, Soviet Union specialists came to Nigeria and after a general topographical examination announced that there were high prospects for more extravagant iron mineral and coal stores in the nation at Ajaokuta.

Nonetheless, the national government marked an agreement in 1970 with a Russian organization, TyazhPromExport (TPE), under which they consented to give some machinery to complete further topographical review to decide the amount of the stores of iron mineral, coal assets in the nation that could be utilized for the proposed iron and steel industry. By 1973, reasonable iron metal deposits were found in Itakpe, Ajabanoko and Oshokoshoko all in the area around Kabba-Okene-Lokoja – Koton Karfe hub, now in Kogi State. The TPE was contracted to set up the primer venture report for the proposed Iron and Steel Industry in Nigeria. In 1975, during the rule of Murtala Mohammed, the fundamental venture report indicating the crude materials base at Itakpe in Kogi plant site area (Ajaokuta), first stage generation volume of 1. 3 mmt, process course (Blast furnace – Basic Oxygen reduction furnace), Product shape (Long items) put together by TPE was checked on, talked about and acknowledged. TPE was in this manner dispatched to set up the detailed project report on Ajaokuta which was finished and submitted in 1977. In 1979, Ajaokuta Steel Company Limited (ASCL ) or NIOMCO, Delta Steel Company (DSC), among others, were built up under Section 2 of National Steel Council Decree No. 60 of September 19, 1979 and fused as Limited Liability Companies. In 1980, previous President Shehu Shagari established the framework stone of an incorporated steel plant in Ajaokuta on 24,000 hectares of sprawling green-field landmass, based on 800-hectares. The steel organization has four distinct sorts of rolling mills inside the plant.

  1. The Billet Mill which produces billets;
  2. The Light Section Mill which delivers round, square, strip and points metals.
  3. The Wire Rod Mill produces wire poles and rebars utilized in development organizations and generation of nails, fencing wire, rope work, screws and nut, and netting and;
  4. The Medium Section and Structural Mill produces parallel spine channels, level with points, unequal edges and standard channels.

The four rolling mills are greater than Aladja, Osogbo, Katsina, and Jos moving plants all together while the coke stove and bye-products plant is greater than all the four refineries in Nigeria set up together. In 1980 to 1983, the government accomplished 84 percent completion of Ajaokuta steel plant as the Light Section Mill of the plant was charged sooner than the booked date, while the Wire Rod Mill was additionally dispatched in April 1984, sooner than the planned month of December. In 1994, gear and machinery erection work at Ajaokuta Steel Plant came to 98 percent completion. With every one of these accomplishments, it was, nonetheless, pitiful that the huge steel plant thought considered and executed by past pioneers had neglected to add to the improvement of Nigeria. The Ajaokuta steel that had come to 98 percent completion as far back as 1994 had not created a solitary steel till date. The coordinated plant was imagined to have multiplier impacts on all divisions of the Nigerian economy, for example, the modern, farming, transport and development areas, among others. The steel plant was intended to deliver 1. 3 million tons of fluid steel per annum in its stage one, with an implicit ability to grow its creation to 2. 6 million tons of level iron and steel items in its second stage and stage three arrangement was wanted to deliver 5. 2 million tons of different kinds of steel items, including substantial plates. The steel plant complex likewise has an exceedingly modern collection of 43 unique plants made up of a web of complex iron, link, and apparatus of various sizes and capacities. Out of the 43 plants, 40 as of now are finished and can create autonomously.

Ajaokuta steel has the ability to be a noteworthy maker of mechanical apparatuses, auto-electrical extra parts, shipbuilding, railroads, and carriages. The steel plant’s first stage has the ability to give guide work to 10,000 specialized staff and roundabout 500,000 for incompetent upstream and downstream business in the event that it is in action. The government had spent over $10 billion more in 34 years and would require another $2 billion to finish the remaining two precent. South Korea, which began its steel development around a similar time with Ajaokuta steel presently has an income base of over N60 billion dollars for each annum and utilizes more than 65,000 staff. Ajaokuta steel would have improved the situation in the event that it had begun creation. As indicated by World Steel Association (WSA) report, South Africa and Egypt created 6. 1 and 5. 0 million tons of steel in 2016, while South Africa is the 22nd on the rundown of nations on steel generation, Egypt is the 27th. China, the world’s biggest steelmaker has a steel generation of 808. 4 million tons speaking to around 50 percent of the worldwide steel yield for 2016, as Japan and India created 104. 8 and 95. 6 million tons of rough steel to keep up the second and third position on the list. For all intents and purposes, every one of the countries that are among the first world companies have improved capacities in steel creation. Indeed, even those that don’t have any of the key mineral information sources required for steelmaking had throughout the years built up the ability to create steel. Japan and South Korea, for example, have no mineral asset for iron and steel, yet they rank among the world best 10 nations in steel creation.

Nigeria that is blessed with so many crude materials, for example, tin, coal, petroleum gas and limestones required for the making of steel is as yet battling with what to do with the lethargic plant. In June 2003, previous President Olusegun Obasanjo awarded Ajaokuta steel to Messrs SOLGAS Energy of the USA on a 10-year residency; in August 2004, the Federal Government ended the SOLGAS pactt due to non-execution. In 2004 and 2005, the Obasanjo organization, once more, conceded another admission to Global Infrastructure Nigeria Limited (GINL) an India organization for the task of Ajaokuta steel and the Nigeria Iron Ore Mining Company (NIOMCO) at Itakpe in Kogi. In any case, the Indian organization did not satisfy the national government’s desire in dealing with the two organizations. Thus, the late Umaru Yar’Adua organization was constrained to repudiate the agreement in April 2008 without meeting the prerequisites of the conditions incorporated with the understanding.

The Indian organization from that point took the Nigerian government to assertion court in London, which additionally crippled the two firms. In 2016, President Muhammadu Buhari satisfied his battle guarantee on Ajaokuta steel by settling the legitimate bottleneck encompassing the organizations out of court. Be that as it may, the central government consented to altered concession arrangement with GINL to empower the firm to hold the National Iron Ore Mining Company, Itakpe. The altered seven-year concession understanding was marked on August 1, 2016, while the national government assumed control over the Ajaokuta steel. While the national government was intending to re-concession Ajaokuta steel once more, partners in the Nigerian Metallurgical Society asked it to finish the staying two for every penny and work the plant for a couple of years before concessioning it. The partners likewise asked the government to give clear and enunciated plan to the advancement and development of metal generation segment as the battle for utilitarian steel organization in Nigeria proceeded.

Proposed Solutions

  1. Limiting the foreign technical assistance to the completion: From everything we can see, the success to the completion lies on the shoulders of Nigerians. First off, the government should go back to the days of sponsoring young scholars to the abroads to learn about the structural engineering needed to build our own machinery and steelmaking. I think, after this is done, we would not as a country have to rely on foreign nations for our own development.
  2. Re-visitation of government’s raw materials policy: The sequencing of various establishments for raw materials acquisition by government should be revisited and followed. It implies that raw materials should be sourced, located, accessed, mined, beneficiated, refined and stockpiled before setting up steel plants.
  3. Operation of government raw materials policy along with government guidelines: Due to the lack of monitoring and control by government, the raw materials policy was not running in operation with the government guidelines. Putting this forward through representatives, this could be changed.

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