The GDP

The Mining sector in the year under review grew by 2.24% in the second quarter (Q2), 2017 contributing its little to the 0.55% growth in Nigeria Gross Domestic Product (GDP). However, nothing was said to have been contributed to the GDP in Q3, 2017 according to the Nigerian Bureau of Statistics.

The ‘World Risk Report’
Published by the Mining Journal, indicated that Nigeria has made remarkable improvements in both hard risk and perceived risk factors. It described the Nigerian Mining Jurisdiction as now having a better investment risk profile than several other leading jurisdictions, and among the best in Africa.

Revenue in Naira and Kobo
The Ministry strengthens its revenue base from N2 Billion Naira generated for the whole of 2016 to over N3.5 Billion naira contributed to the federation account in 2017 through royalties and fees collection.

The Mining Police
The sector saw an improved inter governmental activities as the law providing for the establishment of the mining police became operational with the support of the Nigeria Police Force, Ministry of Interior and other security agencies. This partnership came to life as the need to effectively regulate the sector, provide mines safety, security and tackling the menace of illegal mining became necessary to stem the revenue loss to illegal mining across the country.

The web portal
The ministry launched a web portal at the cost of N750 million to ease the hassles associated with paper registration in the mining sector. Towards achieving best practice in mineral sector governance, “we conceived the need for a centralized GIS Web portal with supporting ICT Infrastructure and the automation of ministry services; all backed up by requisite policy framework and human capital development for sustainability. The overall objective of the project was to increase provision of reliable information and knowledge to enhance promotion of investment in the sector using technology driven innovation.
Significant improvement was also recorded in the Mining Cadastre office’s administration of mineral titles; with the agency now consistently issuing licenses to applicants within 30-45 days as stipulated in the Mining act, provided the applicant has fulfilled all statutory requirements,” the minister of mines and steel development, Dr. Kayode Fayemi, had said. A claim the Miners Association described as not true for now.

Enforcement
Strict enforcement of the ‘use or lose’ clause in the mining law led to the compliance of defaulting mining companies who are now putting their licenses to productive use leading to increased economic activities. More companies are now ensuring they pay their royalties and taxes as and when due, thereby increasing the revenue base. This is evident in the revenue growth from N2 billion to N3.5 Billion.

Investment promotion and mineral trade department
The ministry also established a new department to monitor and control the local mineral trade chain comprising purchasing, sales and export. In its short span, the department has been able to put forth a roadmap for the development of a sustainable framework for mineral trade and export ecosystem. Working in collaboration with the MinDiver project office, the Nigerian Export Supervision Scheme (NESS), Nigerian Export Promotion Council (NEPC), Nigerian Customs Service (NCS), the Presidential Enabling Business Environment Council (PEBEC) and the Federal Ministry of Finance (Home Finance department), new mineral export guidelines and procedures have been developed as immediate remedial measures to curb revenue leakages from mineral exports.

Improved funding
In the year under review, the ministry through the federal government secured $150mn World Bank loan for the Mineral Sector Support for Economic Diversification (MSSED or MinDiver) programme aimed at making finance available to Artisanal Small Miners (ASM) operators through development finance, micro-finance and leasing institutions. The fund will also help to bring back on stream previously abandoned proven mining projects like tin ore, iron ore, coal, gold and lead-zinc.
Also, in the year 2017, the sector witnessed the birth of a new board for the Nigerian Solid Minerals Development Fund (SMDF) which launched a N5Billion fund to provide single digit interest loans to mining projects in Nigeria In collaboration with the Bank of Industry (BOI).
Another N30 Billion Natural Resources Intervention Fund for the promotion of exploration of new minerals and to strengthen the regulatory capacity of the ministry was ‘partially’ accessed.

Other gains of 2017
Other gains of the sector included the establishment of the National Council on Mining and Mineral Resources Development (NCMMRD) and the Mining Implementation and Strategy Team (MIST), which became operational in the year under review.
MIST is a multi-stakeholder team with the mandate to guide the implementation of the roadmap while NCMMRD is designed to be a well-structured platform where stakeholders in the sector can converge periodically to develop policy advisory, validation, and other interventions, to effectively guide government in achieving the full implementation of the Roadmap and the achievement of the targets contained therein. Membership of the NCMMRD comprises all state commissioners with oversight of mining in the respective states as well as other stakeholders in the sector.

Dangote vs BUA
This review would not be complete without a peep into the controversy between two giants in the mining sector- Dangote Group and the BUA Group of Companies over mining right in Obuh community, Okpella Etsako East local government area of Edo state; which lead to the federal government’s directive that the site be vacated by all parties involved to avoid break down of law and order in the area. The controversy led to accusations by the community leaders and Kogi state indigenes that the ministry was bias and causing the crisis by giving licenses to the feuding parties to mine in the same site and urged both the federal and Edo state governments to urgently find a peaceful resolution to the crisis.
The ministry however said, the BUA outcry was campaign of calumny against it. It said BUA does not have mining lease on the said site No. 2541ML therefore it was operating illegally. Nonetheless, the case is already in court of competent jurisdiction to ascertain the true licensee of the mine site. We hope judgment on this can be passed in the first quarter of this year so as to give way to the continuous engagement of the labour force in the affected community and economic activities can thrive once again.

Improvements in geological prospect
Collection and dissemination of geosciences data was expanded as characterization of Kaolin in Ekiti and exploration for gold in Niger states was completed while the geology and mineral database of 30 states was generated. Also, geological mapping of 1:50,000 Sheets 53 Maru (NW,NE,SW,SE) was also carried out.

Projections into 2018
As the year 2018 begins to count, here are some of the expectations in the mining sector.
A new mineral export guidelines and procedures to curb revenue leakages from mineral exports shall come into effect in the first quarter of 2018.

$600M investment fund
An Investment fund of $600M will also be worked out for the sector, in collaboration with the Nigerian Sovereign Investment Authority and the Nigerian Stock Exchange and others.

Research grant
Also an N100million from the intervention funds will be used to support Geo-sciences research in tertiary institutions through the provision of research grants to select universities.

Gold exchange programme
2018 will witness partnership with some state governments and the private sector is a Gold Purchase scheme. The mandate of the scheme will include equipping of the artisanal miners; provision of extension services; and the off-take of all the gold produced by the participants in the scheme. The aim is to facilitate employment creation, poverty reduction, and increase in revenue to the federation account.

Geological Prospectivity
Another projection into the year is an extensive Electromagnetic Airborne Geophysical Survey of promising parts of the country which will be undertaken. “We aim to work with competent consultants to deploy logistical and technical equipment with radiometric, magnetic, electromagnetic and allied capabilities, to capture and provide analysis of the geology of Nigeria, and the mineralization of the areas covered”
“The foregoing would avail sufficient data for interpretation and analysis to allow for strategic planning and targeting of potential areas for further exploration work, and ground verification of the data from the ‘AGS’. We consider this a very important part of our work in 2018, to deliver a comprehensive bankable data of our mineral endowments across the country,” Fayemi said.

Leave a Reply