Revamping the fortunes of Delta Steel company
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| A cross section of a facility at Delta Steel Company, Ovwian-Aladja, Warri, Delta State. |
In view of the economic contributions of the steel sector to the growth of industrialized countries, Alexander Chiejina writes that the revamping of the Delta Steel Company (DSC) will no doubt reposition Nigeria's quest towards becoming one of the 20 leading companies in 2020
With iron and steel being used widely in the construction of roads, railways, and other large modern structures, such as stadia and skyscrapers, bridges, and airports, which are supported by a steel skeleton, there is no gain saying that its economic relevance is of utmost importance to the growth of any nation.
Taking a cursory look at the nation, Delta Steel Company Plc, located at Ovwian-Aladja, Warri, Delta State, is the only fully integrated steel plant producing steel from basic raw material. In the past, the plant was one of the main projects of the third National development plan (1975-1980) and was conceptualized to satisfy the increasing domestic demand for steel products, the realization of the natural aspiration for self sustenance, rapid industrial growth and technological development.
Sadly, over the years, DSC became prostrate despite its grandiose commissioning in January 1982 after its incorporation in 1979. To stakeholders in the steel sector, the company seemed to have transformed into another failed hope for millions of Nigerians who were eager to conform to global technological advancement that is driven by emerging trends in the steel sector.
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| A section of the plant at DSC, Ovwian-Aladja, Warri, Delta State. |
With steep public disillusion running high, the federal Government initiated a rehabilitation programme in 2000 but this was never completed. This situation came to a height when in 1995, the commercial operations of the steel plant had ceased due to non availability of funds, raw materials, spares and accessories while its key equipment were in bad condition and non operational. It easily became one among the numerous but failed gigantic projects of government.
In the wake of these challenges, the dramatic turnaround of DSC, following the privatization programme that led to a share purchase agreement (SPA) with Global Infrastructural Nigeria Limited (GINL) has seen the fortunes of the former comatose industrial liability into a fully operational and viable producer and marketer of high quality iron and steel products.
In a chat with newsmen, N.S.Singh, Executive Director, Operations revealed that to the most adventurous businessman, the condition at DSC was very scary as it did not present any prospects for considerable returns on investments, but this outlook did not deter Global Steel when it moved in to revamp the company in 2005.
The executive director disclosed that relying on its strategic experience in revamping comatose plants, the company had within a short period of nine months proved industry pundits wrong that any investment on DSC and similar plants across the country was a lost investment. He maintained that within the period, Delta Steel was rendered inactive but suddenly came back to life as modern control and automation systems have been installed in the plants with remarkable results being achieved.
In his words "from its comatose status before the commissioning of Line 1 in April 2005 and expected commissioning of Line 2 in November 2006, the Pellet Plant has achieved a maximum production of 2200MT/day with average production of about 25, 000 to 30, 000 MT. global steel now plans to install Distribution control system (DCS) in the Pellet Plant to ensure continued double line operations to achieve production of 120, 000MT monthly.
"The Module IV of the DR plant was commissioned on May 3, 2006 and commenced production on May 22, 2006. The company invested huge resources to procure critical and high value equipment and production consumables. Most of the grounded Electric Arc Furnace (EAF) have been repaired and technologically improved for production. Its casters have been commissioned. Don't forget that the Rolling Mill is once again alive as it has successfully rolled 12mm, 16mm, 20mm, 25mm and 32mm steel rods. The mill has so far achieved maximum production of 892.3MT even as the plant has already produced 686, 086 MT till date," Singh disclosed.
Lending his view, Nwabuokei disclosed that Global Steel has commenced investment to enhance its steel making capacity from one million tonnes per annum to 2.4 MTPA. Nwabuokei stated that major modification include rehabilitation in SMS , automation of furnaces and casters, enhancing transformer capacity from 60 MVA to 100 MVA in each furnace, equipping each furnace with oxy fuel burners; co-jets lance, eccentric bottom tapping (EBT) and water cooled panels.
He added that "production performance since takeover has been impressive with the plant constant 24hours non-stop. All the plant yields are available, necessary trainings retraining are going on and the country's production is sold everywhere, even beyond the shores of the country."
No doubt, the rebirth of steel in Nigeria though in its relative nascent stage has been contributing in no small measure to the overall developmental verve of the economy. Little wonder research and development programmes are top priorities to management particularly in terms of the substitution of local materials as well as consolidation of premium quality technology process with the view of keeping abreast with the trends in steel development globally.
While DSC is awarded the ISO 9001; 2000 Quality Management System, the organization has also been awarded the 'NIS 117 Silver Certificate' award in the field of construction rebars for two successive years. Today, Delta steel is changing to meet the challenge of the future, viz-a-viz modernization, re-invention, re-structuring and upgrading of facilities. It is believed that the quality of the company's products has been recognized by major blue-chip clients and customers both in the public and private sector as a reliable, quality and customer driven, and responsive provider of superior steel and casting products.
In view of the abundant fortunes that accrue from steel production, recent records have shown that Nigeria is one of the lowest steel consumption countries in the world with less than about 600 thousand tonnes per annum as against a projected consumption figure of 10 million tonnes per annum. The steel sector in Nigeria, just like most public institutions like NEPA now PHCN and the Nigeria Railways were in total decay and comatose.
The Federal Government has put in place some programmes aimed at driving the economy with the hope of becoming one of the 20 biggest economies of the world by the year 2020. A casual look at this blue print, cast some doubt on the plan as steel has no clearly defined position.
While the steel industry remains the bedrock of any country's industrialisation, It is still the least on the development index in Nigeria. Recently, the Federal Government opted to concession the Ajaokuta Steel Plant, National Iron Ore Mining Company, Itakpe to an Indian Company, Global Steel/Global Infrastructure (Nigeria) Limited, an affiliate of ISPAT Industries of India, a conglomerate with five decades of character certification in Steel business with capacity to produce 14 million tonnes of steel and related products annually and operating in seven countries of the world.
Of all these takeovers and concessions, the case of Ajaokuta and DSC has elicited a lot of passion and criticism from the public. However, it will be obvious that the Nigerian steel industry, hitherto described as the bottomless pit or museum, has come back to life to drive the nation's quest towards becoming one of the twenty leading countries by the year 2020.
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