The Federal Government has signed a Sub-lease and Operations Agreement with Premium Steel and Mines Limited (PSML) to revive the moribund Delta Steel Company in Ovwian-Aladja, Delta State, targeting a return to full-scale integrated steel production with an annual capacity of 1 million tonnes. The agreement, executed on August 20, 2026, also secures a commitment of more than US$1.3 billion in investment from PSML, according to a press release signed by Salamatu Jibaniya, Head, Press and Public Relations, Ministry of Steel Development.
Background of the Delta Steel Plant and Privatisation Efforts
The Delta Steel Plant, commissioned in 1982, was established with an installed capacity of one million tonnes of liquid steel annually. It was designed as an integrated steel plant intended to make significant contributions to Nigeria's industrial development. However, prolonged operational challenges caused the plant to operate at only about 25 per cent of its designed capacity before it was eventually shut down.
In 2005, the Federal Government privatised the company to Global Infrastructure Holdings Limited in a bid to attract private capital for its revival. Later, the Asset Management Corporation of Nigeria (AMCON) sold the company to Premium Steel and Mines Limited in 2015 to recover unserviceable debts. Since 2015, the plant has not operated as an integrated steel plant, a situation the current administration under President Bola Ahmed Tinubu is now seeking to reverse.
Investment Commitments and Operational Timeline
Under the new arrangement, PSML has committed to investing more than US$1.3 billion in raw material exploration and exploitation, rehabilitation and modernisation of the steel plant, and other critical infrastructure required to achieve sustainable production. The company has also committed to fully reactivate the integrated steel plant and commence commercial operations within 18 to 24 months, subject to the availability of sustainable iron ore supply, which the Federal Government said has now been provided through the agreement with the National Iron Ore Mining Company (NIOMCO), Itakpe.
Speaking on the development, the Minister of Steel Development, Prince Shuaibu Abubakar Audu, said the revival of the Delta Steel Company aligns with President Tinubu's Renewed Hope Agenda, particularly the administration's commitment to strengthening local manufacturing, creating employment and unlocking Nigeria's industrial potential. According to him, "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."
Expected Economic Impact and Job Creation
The project is expected to reactivate NIOMCO and support the development of the Ajabanoko iron ore deposits, facilitate the rehabilitation and commercial operation of PSML, attract more than US$1.3 billion in investment, and create about 5,000 direct and over 20,000 indirect jobs. The Minister noted that the successful operation of the plant would depend on reliable access to iron ore and other critical raw materials, particularly from NIOMCO, Itakpe, as well as dependable power supply, logistics and supporting infrastructure.
The revival is also expected to contribute to Nigeria's target of producing 10 million tonnes of liquid steel annually by 2030, while strengthening rail and maritime logistics through increased freight movement along the Central Rail Line and greater utilisation of the Delta Steel Company Jetty. The Federal Government, the Ministry said, would continue to collaborate with responsible private-sector investors to unlock the potential of Nigeria's steel sector, while ensuring access to raw materials, infrastructure, policy coordination and an enabling business environment.
Implementation and Government Support
The Federal Ministry of Steel Development stressed that the agreement must translate into actual mine development, plant rehabilitation, commercial steel production and sustainable employment within the agreed 18-to-24-month implementation period. The Ministry commended the support of the Ministry of Justice and the Ministry of Solid Minerals Development, while also acknowledging the commitment of Premium Steel and Mines Limited towards the revival of the strategic national asset.
The Federal Government remains committed to transforming Nigeria into a competitive steel-producing nation capable of meeting a substantial proportion of domestic demand and positioning the country as a major player in the African steel and metals value chain.
