FG, PSML sign $1.3bn deal to revive Delta Steel Company 

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ABUJA, Nigeria (NPA) — The Federal Government has signed a sub-lease agreement with Premium Steel and Mines Ltd. (PSML) for the restoration and full operationalisation of the former Delta Steel Company at Ovwian-Aladja, Delta State. 

The News Agency of Nigeria (NAN) reports that the agreement was signed between the National Iron Ore Mining Company (NIOMCO), Itakpe, and PSML. 

According to a statement issued in Abuja on Thursday by Salamatu Jibaniya, Head of Press and Public Relations, Federal Ministry of Steel Development, PSML has committed to investing more than $1.3 billion in raw materials exploration and exploitation, as well as the rehabilitation and modernisation of the steel plant. 

The agreement is expected to facilitate the reactivation of the integrated steel plant, strengthen Nigeria’s domestic steel production capacity and reduce the country’s dependence on imported steel products. 

The Minister of Steel Development, Shuaibu Audu, said the investment would cover raw materials exploration and exploitation, rehabilitation and modernisation of the plant to achieve sustainable operations and full production capacity. 

According to Audu, the company is expected to restore the plant to its designed capacity of one million metric tonnes of liquid steel annually. 

“It is also expected to commence commercial operations within 18 to 24 months, subject to sustainable iron ore supply,” he said. 

The minister described the agreement as a major step in the Federal Government’s efforts to reposition Nigeria’s steel assets as drivers of industrialisation, economic diversification, job creation and sustainable national development. 

He said successful implementation of the agreement would support the reactivation of NIOMCO and facilitate the development of the Ajabanoko iron ore deposits. 

The project is expected to create about 5,000 direct jobs and more than 20,000 indirect jobs, according to the minister. 

Audu said the project would also contribute to Nigeria’s target of producing 10 million tonnes of liquid steel annually by 2030. 

He added that increased steel production would boost freight movement along the Central Rail Line and encourage greater utilisation of the Delta Steel Company Jetty. 

The minister said the reactivation of the Delta Steel Company was in line with President Bola Tinubu’s Renewed Hope Agenda. 

He stressed that the project went beyond reviving an abandoned industrial facility, describing it as an effort to restore Nigeria’s capacity to produce steel locally and strengthen the foundation for sustainable industrialisation. 

“The revival of Delta Steel Company is not merely about bringing an old industrial facility back to life. 

“It is about restoring Nigeria’s capacity to produce steel locally, creating opportunities for our young people, supporting downstream industries and strengthening the foundation for sustainable industrialisation,” Audu said. 

The minister said the Federal Government would continue to work with responsible private-sector investors to unlock the potential of Nigeria’s steel sector. 

He noted that the success of such investments would depend on adequate raw materials, infrastructure, policy coordination and an enabling business environment. 

Audu further identified reliable access to iron ore and other critical raw materials from NIOMCO, dependable power supply, logistics and supporting infrastructure as critical factors for the success of the project. 

The Delta Steel Plant was established in 1982 as an integrated steel plant with an installed capacity of one million metric tonnes of liquid steel per annum. 

The plant eventually ceased operating as an integrated steel facility, prompting renewed efforts by the Federal Government to attract private-sector investment for its reactivation. 

The latest agreement is therefore expected to provide a framework for the restoration of the facility and strengthen Nigeria’s drive towards increased domestic steel production.