After more than two decades of inactivity due to ownership crisis and power supply issues, the moribund Aluminium Smelter Company of Nigeria (Alscon) may soon be revived, following federal government plans to connect the Akwa Ibom-based facility to the national grid.
Nigeria’s Minister of Power, Adebayo Adelabu, met on Tuesday with Alscon’s management team, alongside representatives from the Transmission Company of Nigeria (TCN) and the Niger Delta Power Holding Company (NDPHC), to address the plant’s longstanding energy challenges.
In their presentation, Alscon’s management cited the lack of gas and electricity, as well as security and legal concerns, as key factors keeping the plant offline.
Adelabu acknowledged the severity of the power issue, saying it prompted his visit to the company.
“Having appreciated this, I have come to visit the company to discuss with the managers and owners of the company and all the other stakeholders, … and all the contractors involved, to devise an immediate solution to the power problem this company has been facing,” he said.
Short-term power solution in sight
“And I am happy we have made very good progress with the meeting of today as we have determined a short-term solution to the problem of power to connect this company to the national grid … and we have made good progress.”
The minister added that a solution is within reach and urged all parties to act on the agreed action points, which he pledged to personally oversee.
“I believe that within the next 90 days, we will be able to achieve the short-term solution.”
Potential to supply 540MW to the national grid
Alscon has an installed power-generating capacity of 540MW (open cycle, expandable to 660MW), comprising six gas-fired turbines of 90MW each.
This idle capacity could potentially be supplied to the national grid.
The plant also has an existing gas pipeline connected to the same system that supplies Ibom Power.
However, it has remained unused for 11 years, despite an active supply agreement, according to the minister.
Gas supply hinges on commercial viability
Adelabu said gas supply was not a major obstacle and could be resolved through pricing negotiations.
“This is all about commercials…. If the price is right, the gas company will supply. We believe they can sit down with the gas company and agree on a commercially viable price that will ensure that gas is supplied to the company.”
He added that Alscon “will be able to evacuate the entire 540MW to the national grid” once all necessary infrastructure is in place.
This includes a 330/132kVA substation currently under construction by the NDPHC, along with DC transmission lines from Ikot Ekpene to Ikot Abasi.
About the Alscon smelter plant
Commissioned in 1997, Alscon was designed to produce approximately 200,000 metric tons of aluminium ingots annually for both domestic use and export.
However, operations came to a halt in 2000 due to persistent gas supply shortages and internal management disputes.
In response, the Nigerian government sold an 85% controlling stake in the plant to Russia’s UC RUSAL for $205m in 2007, while retaining the remaining shares.
UC RUSAL, one of the world’s largest aluminium producers, took over the asset amid high expectations and had already begun modernising the factory.
Yet, the privatisation deal soon became mired in controversy, triggering a protracted legal battle.
The Nigerian Supreme Court eventually ruled in favour of the U.S.-based BFI Group, overturning the sale.
Despite the court’s decision, the ruling was never implemented.
As a result, Alscon has remained dormant, with no production activity and no contribution to the national power grid since its shutdown.
Presidential directive and state government support
President Bola Tinubu issued a directive in July 2024 to restart the company, followed by a two-day tour of the site by Minister of Steel Development, Shuaibu Audu, in January 2025.
But the Development Adviser to Alscon, Viacheslav Krylov, had said a restart was delayed largely by the lack of a stable and high-capacity power supply.
“Smelting is a power-intensive process that requires uninterrupted, high-volume electricity. The current energy options are insufficient to restart the plant without a reliable backup,” Krylov said.
He urged the government to enhance grid reliability and consider Power Purchase Agreements (PPAs) that would allow ALSCON to contribute surplus power to the national grid, earning the company additional revenue.
“Wheeling excess power to the grid will not only boost national electricity capacity but also sustain the company financially,” he added.
The Akwa Ibom State Government has also pledged full support for efforts to restore production at the facility, which is one of the legacy projects within the state’s Liberty Free Trade Zone.
If successfully revived, the plant is expected to save millions of dollars in import costs, boost GDP, and create over 3,000 direct jobs.