Nigeria and Chinese companies have signed a memorandum of understanding (MoU) for a $1 billion iron ore-to-steel project. Under the agreement, Sinomach-He will act as the master contractor, leveraging its expertise in engineering, procurement, installation, commissioning, and training.
Edijala praised the minister for streamlining the licensing process, highlighting its efficiency and transparency. “We applied for an exploration license for our iron ore mining project at the Mining Cadastral Office and received approval promptly without bureaucratic hurdles,” Edijala stated. “This demonstrates that the system is fair and effective. I commend you for this.”
Edijala explained that the project’s model includes transporting steel from the iron ore site to the manufacturing plant, which will be expanded to support Nigeria’s industrialization needs. He noted that the project would benefit from tax waivers for equipment imports and tax holidays during the initial phase to mitigate macroeconomic fluctuations and meet its objectives.
Hou Encai, Vice-Manager of Sinomach-He, emphasized the company’s readiness to begin the project. Established in 1958, the state-owned firm employs over 15,000 people, including 2,000 engineers.
In his remarks, Minister Alake assured the companies of the government’s support to expedite the project’s completion. He hailed the project as a significant advancement in the government’s push for local value addition in the solid minerals sector.
Alake noted that the government has shifted from a pit-to-port policy, which focused on exporting raw minerals, to one emphasizing local extraction and value addition. This change is aimed at creating jobs for youth, facilitating skills transfer, and improving the trade balance. The ministry now requires mining license applicants to include plans for processing raw minerals as a condition for approval.