THE WINDING PATH OF STEEL DEVELOPMENT
Nigeria’s need for engineering services such as automobile repair, marine equipment maintenance, light structural steel work and bolts and nuts which was last manufactured, dates back to 1949.
It was during this time that firms such as Dorman Long and Amalgamated Engineering Limited, located at Idi-Oro, Lagos, were established.
In 1950, it was realized that the size of the market in those specific areas had been
overestimated and companies involved had to reschedule their priorities. These companies
were forced to take on new ventures.
But between 1958 and 1960, Nigeria consulted with British experts on the viability and economic advantages of large-scale steel production. The experts argued that the time was not ripe for such projects because of the high cost of the equipment required for a full-scale steel industry. Besides, the country did not have the skilled manpower to operate steel plants.
Initially, the government was only interested in the establishment of rolling mills, but the growing awareness of our massive potentials in terms of raw materials like iron ore, coal and limestone, reinforced the economic feasibility of establishing an integrated iron and steel plant.
Thus, between 1958 and 1967, the Federal Government invited and received proposal for the feasibility of establishing a steel plant in the country. The Union of Soviet Socialist Republics (USSR) was invited because her proposals for Nigeria’s industrial take-off were more realistic and encouraging than those presented by other foreign countries.
As soon as the report of the Soviet team was accepted, the Nigeria Steel Development Authority (NSDA) was set up under Decree No. 19 of 1971 to oversee all matters relating to
iron and steel. The Federal Government commissioned the Russian firm Tiaji Promex-Port to
prepare a detailed report in 1974, and subsequently signed a multibillion naira global contract in 1979 with the same company for the preparation of working drawings, supply and erection of equipment and training of personnel for Ajaokuta steel company.
Eventually, on 18 September 1978, following the promulgation of Decree No.66, which
dissolved the former National Steel Development Authority, Ajaokuta Steel Company Limited,
a Federal Government wholly-owned company, was born. The steel complex is located on the
west bank of the River Niger, and it is bounded the south by Ajaokuta village and the west hills.
The second steel plant, Delta steel Complex, Aladja, came to the drawing board in the Third National Development Plan. The main agreement for its construction was signed in March 1977 between the Federal Government and a German-Austrian consortium. It went into production in 1981.
But the Delta steel Complex, Aladja, was built on a 175-hectare piece of land and has consumed N1.26 billion. It is an integrated plant consisting of a pellet plant, a direct reduction plant, an electric and furnace shop, a continuous casting plant, a rolling mill, a lime calcinating plant and an oxygen plant. The Aladja plant uses the direct reduction process to produce steel. The plant is expected to produce one million metric tones of liquid steel.
However,the Ajaokuata steel complex is also integrated but its concept is based on the blast furnace-basic oxygen furnace (BF-BOF) process of steel making. The blast furnace is a traditional process. It is flexible in operation and it is through this method that more
than 90% of the world steel is produced.
In the same vein,the Ajaokuta project was conceived in three phases. The first phase includes a river port, electricity generating plants, water treatment plants, telecommunication facilities and a new steel town.
From available statistics, the Federal government has invested over four billion naira in the steel industry, yet neither Aladja nor Ajaokuta has performed a miracle. One of the major problems is that there have been no plans made to develop the basic raw material, iron ore, to feed these plants.
THE WINDING PATH OF STEEL DEVELOPMENT