It could be recalled that the Federal Government summarily terminated the Concession Agreement it entered with GIHL in August 2004, accusing it of incompetence and breach of the Agreement.

A 14-member  Interim Management Committee 9IMC0 was set that  up to oversee the two companies, pending governments final decision on the multi-billion dollar, 98% completed  investments that many have viewed as “jinxed”

The IMC of ASCL  and NIOMCO, disclosed this at a news conference in Abuja yesterday.
The IMC, also said that the combined 4,750 staff strength of the two companies now on strike, would be paid all their six months salary arrears running to not less than N1.8 billion by next week.

The Chairman of the IMC of the two companies, Engr. Samuel Osahon, who addressed the press in company of other members said: “available records available to us  indicate that a total indebtedness of N23 billion was owed Nigeria Banks by GINL”, he said

He however, did not mentioned the Banks.

“The Concession Agreement envisaged Foreign Direct Investment (FDI), but the reports of the Monitoring Committee showed that GIHL invested the sum of $135 million and these funds were used for purchase of Billets which the rolled and sold as wire and rods in Nigeria. Very little of the fund was invested in the completion, reactivation and commissioning of the steel plant, as was signed in the Concession Agreement”, the IMC charged.

According to him, at NIOMCO, in February 2005, at the time GIHL signed the Agreement, about 380,000 metric tonnes of iron ore concentrates was produced and pilled at the company. But that shortly after the coming of the concessionaire, it was sold to Delta Steel Company (DSC) owed by GIHL.

The IMC said that GIHL sold the iron ore concentrate to DSC at a price of $21 per tone which was far below its international price, adding that further under-invoicing of the commodity in favour of DSC led to a loss of N2.389 billion from NIOMCO.

Hauling more allegations against the embattled company, the IMC boss said that in September, 2005, there was a fire outbreak at the Sinter Plant at ASCL. That after the fire incident, ASCL was paid N304 million as claims by its Insurance company, yet, said Osahon, the item were not replaced.

“The contributory Pension Funds deducted from Staff salaries were not remitted to Pensions Funds Administrators and the GIHL part of the contributory pension were never paid”, the IMC Chair said, adding that, “the  Pay as You Earn (PAYE) deductions were equally not remitted to FGN. The concession Agreement fees for both ASCL and NIOMCO were never paid to government despite several demands”, he said.

The Agreement stipulated that GIHL pays 1% of its total earning per year  from ASCL and 2% for NIOMCO to the Federal Government.

“It is a known fact that GIHL moved several equipments, material and scraps from ASCL to DSC, Aladja without paying for them. At a stage, the FGN set up an internal enquiry to ascertain the extend of these lootings”, he said,  “the report confirmed the cannibalisation and movement of material to DSC without costing, payment or approval and these never returned. Even the ones taken with consent of the Monitoring committee were also not returned”, he said.

On staff salary, he told the Press that GIHL was owing ASCL/NIOMCO staff salaries for February, March and part of January, 2008 before the termination of the Agreement in April this year.

He however affirmed, the present Ministers of Mines and Steel Development, have worked hard in conjunction with the IMC to ensure that the N200 million per month owed 3,400 staff of ASCL and N100 million  per month wage bill of the 1,350 staff of NIOMCO are paid anytime from next week.

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