Optimistic projections have never been a problem in Nigeria’s bedevilled mining sector but with several hardly acknowledged but extremely potent challenges, there has been lots of motions but little movement towards actualising plans to boost the mining sector’s current 0.4% to an annual $27 billion (about N 9.7 trillion) contribution to the Gross Domestic Product (GDP) by 2025. With government’s huge financial burden, declining revenues from oil, the need to move beyond being a mono-economy, utilise dormant potentials, rapidly create new employment and the need to usher in positive economic multiplier effects, solid minerals development has become a paramount necessity for the Nigerian economy.
Its challenges harbour huge potentials for quick wins that can benefit the federal states and local governments as well as the entire citizenry. Thus, it was heartwarming for many with analytical mind that days ago when he resumed as Nigeria’s new Minister of Mines and Steel Development, Olamilekan Adegbite expressed idealistic passions about the possibilities of achieving a paradigm shift in Nigeria’s mining sector. His predecessor, Mr. Kayode Fayemi was identified with such fervent passion for the sector and indeed, the ruling party’s manifesto, the Buhari administration’s Change/Next Level Agenda all bubbled with huge enthusiasm for the sector. Nonetheless, after the visionary outlines laid out under Fayemi’s ministerial leadership before he returned to the governorship seat in Ekiti, Nigeria seems too far from actualizing lofty year 2025 targets identified under the “Roadmap for the Growth and Development of the Nigerian Mining Industry.”
Today, the Nigerian mining sector still reflects the perplexing realities honestly stated under the Mining Roadmap developed during Fayemi’s tenure: “Nigeria’s minerals and mining sector is still largely underdeveloped despite its glorious past and abundance· of mineral resources for development, including high-value metallic minerals, industrial minerals, and energy· minerals.”
Identifiable progress made in the sector between 2007 and now include the passage· of a new Nigerian Minerals and Mining Act (2007), a Nigerian Mineral and Metals Policy (2008), creation of a modern Mining Cadastre system, the refinement of the tax code, and the expansion in airborne mapping of the country to sharpen knowledge of the mineral endowments. As important as these progress steps have been, Nigeria can and should do· more. Officially-acknowledged multidimensional challenges that Nigeria’s mining sector continues to contend are euphemistically identified as “geosciences data and information, industry participants, stakeholders, institutions, governance and other enablers of the sector.”
To the layman, illegal miners, mischievous government bureaucrats/operatives, illegal alien buyers of untaxed solid minerals are among the most visible challenges of the sector. While several government officials, including a minister may be striving patriotically to achieve excellence, some bureaucrats and even, security personnel who are supposed to ensure law and order in mining areas may be compromised. “Vicious illegal miners and officials who surreptitiously arrange the overlapping of mining title through deliberate ‘mistakes’ in defining Title both represent the most potent twin threat that can ultimately sabotage the genuine vision of government and private investors,” a businessman, Alhaji Adamu Mani told The Nation.
Nonetheless, Nigeria’s new Minister of Mines and Steel Development, Olamilekan Adegbite seems upbeat, expressing idealistic passion that resonates very well with the high expectations of stakeholders.
Speaking with reporters shortly after he and the Minister of State for Mines and Steel Development , Okechukwu Ogah were sworn in last week, Adegbite, the immediate past Commissioner for Works and Infrastructure in Ogun State made clear that among others, he is targeting a 40% increase in job creation an aggressive revenue increase and improving the lots of many citizens in line with President Muhammadu Buhari’s goal of lifting 100 million people out of the clutches of poverty within ten years.
But are these doable or not? While Nigeria’s long and painful history of mining began in 1903 when the British colonial government created the Mineral Survey of the Northern Protectorates, the discovery of oil truncated attention for mining development while prevalent official corruption further held it back until the current administration came in with the Economic Recovery and Growth Plan (ERGP) and the ‘Roadmap for the Growth and Development of the Nigerian Mining Industry’ (Mining Roadmap).
Before then, the 2014 Annual Survey of the Frasier Institute had ranked Nigeria as one of the 10 least attractive jurisdictions in the world for mining investment. The Mining Roadmap particularly acknowledges security challenges in the mining sector:
Adegbite’s first case study or ‘low-hanging fruit’ may be the likes of the Baba-Tsauni Mining Project located in nearby Gwagwalada Area Council – a potentially-vibrant enterprise with capacity to generate thousands of new employment, expanded tax base and other economic multiplier effects.
The Buhari administration’s economic development blueprint named the Economic Recovery and Growth Plan (ERGP) focuses firmly on such objectives. This explains the reason why the Federal Government convened the ERGP Focus Lab in May 2018, contracting Malaysian investment experts, including those who laid out the directions that transformed Malaysian economy, to come and help transform Nigeria’s core economic sectors such as agriculture, transportation, power, gas, manufacturing and processing (including solid minerals).
According to Vice President Yemi Osinbajo, the ERGP Focus Labs pooled public and private sector participants’ resources towards laying firm commitments for US$ 22.5 billion and creation of 513, 000 jobs between 2018 and 2020 while laying a foundation for the inflow of US$39.12 billion investments and creation of about 716, 079 jobs between now and 2025.
“The Focus Labs help us to translate high level plans into detailed operational activities, involving close collaboration between government agencies, the private sector and civil societies. The Focus Labs also break down silos and force key stakeholders to work together in an intensive environment with specific deliverables and timeline.
“This initial set of labs was conducted in three selected areas of agriculture and transport, manufacturing and processing, as well as power and gas; the main aim is to unlock private investments commitments in these critical areas and create jobs for Nigerians. Our target was to mobilise at least $25 billion or its equivalent in Naira, in private investments,” the Vice President had stated on its opening day.
In a subsequent statement, the then Ministry of Budget and National Planning noted that the initiative produced 67, 200 man-hours of effort within a six-week period· and involved 180 organisations including the relevant ministries, government agencies, authorities and private sector companies.”
Also, 20 syndication meetings were held with subject matter experts, including senior government officials, corporations and entrepreneurs during the period.
In recognition of the Baba-Tsauni Mining Project’s capacity to unlock development bounties, including two thousand new jobs, eight thousand secondary employment, a brand new school and a decent structure to replace a wobbling health centre for the Baba-Tsauni community in Gwagwalada local government area of Abuja, a letter dated May 25, 2018 was issued, as agreed at the Lab, confirming the sanctity of mining title covering 236 cubit units or 49.3km square, in favour of Iron Ore Mining (IOM) Limited who are leading the consortium working on Baba-Tsauni Mining project alongside the Wiesbaden, Germany based Julius Berger International which had expressed preparedness to mobilise mining equipment worth millions of dollars.
However, the Mining Cadastre Office (MCO) held back till date, basing its decision on issues emanating from a previous letter of 2017 which contained ‘a mistake.’
At the Focus Lab, attention had been focused on resolving the “Error in the title of Mining Lease11675” which resulted in inability of project owner (IOM) to commence operation even though its Baba-Tsauni Mining Project received a mining lease that was granted back in 2011 to mine lead and zinc minerals for the period of 25 years. However, in 2017, the project owners received a letter from the Mining Cadastre Office, attempting to amend the Mining Lease due to an internal mistake within the MCO.
Thus, because of this ‘mistake’ and subsequent lengthy ‘discussions’ and contradictive legal arguments since 2017, the Baba-Tsauni Mining Project remains on a spot even, with seven years previously spent on exploration and the current beneficiaries are illegal miners who audaciously encroach on the area.
Specifically, two decisions were made: the Minister was asked to affirm the Mining Lease of IOM Limited, to resolve the unduly lingering problem and avert potential loss of an initial $36 million investment along with some 2, 000 possible new jobs as well as negative international investor perception that may hurt other sectors. Secondly, it was decided that the Mines Police should enforce the letter that was issued and eject illegal encroachers on the project site
With a truly enabling environment devoid of intrusive or disruptive influences of government, communities and illegal operators, strong communication strategies between the nation and the international community and between all stakeholders can foster benefits sharing, as well as agreeable and accountable development of solid minerals and the mining sector towards engendering long-term opportunities including jobs, inclusive economic prosperity and vastly increased revenue prospects for the nation.
All these are feasible with the type of leadership and commitment being promised by the current dispensation