The Minister of Mines and Steel Development, Arc. Olamilekan Adegbite, has urged the financial industry to take a plunge into the investments opportunities in the mining sector to impact the nation’s economy positively.
Adegbite made the appeal at the Lagos Chamber of Commerce and Industry (LCCI) Mining and Solid Minerals Conference with the theme: “Solid Minerals: The Foreign Exchange Game Changer,” on Thursday.
He said that a sustainable and well governed mining sector with good investment inflows was key to a diversified economy beyond oil in the present economic environment.
Adegbite, however, said that the success of rebuilding of the industry to achieve the transformational ambition for shared mining prosperity depended on the participation of all stakeholders, including the vibrant financing community.
He noted that the National Integrated Mineral Exploration Programme (NIMEP), an initiative of government, which was at an advanced stage, would provide reliable geo-data for investment decision-making.
According to him, the programme has further exposed investment opportunities in gold, lead, zinc, battery minerals, barite, and iron ore.
“A key constraint in the accelerated development of solid minerals is the undeveloped financing mechanisms for the mining sector.
“The Nigeria banking system has limited exposure to mining and this probably is due to lack of sufficient understanding of the opportunities in mining or the complex nature of the sector.
“NIMEP is a government programme to show the way, but the money is still very small and the 50 million dollars we had, we have only been able to do four out of the 44 minerals discovered as exploration is a very huge capital intensive project.
“What we want to do is that the results from this NIMEP initiative would be sold through auction to have a revolving fund, so that the money that comes back from this would be used for further exploration,” he said.
The minister said that the ministry would embark on a transformational reform agenda aimed at providing good practice in mineral resource management.
Dr Michael Olawale-Cole, President, LCCI, said the theme was to facilitate stakeholders’ dialogue among federal regulatory agencies, financial institutions, and industry practitioners from the mining sector to discuss the untapped opportunities in the sector.
This, he said, could elevate the sector to become a major foreign exchange earner for the government.
“A recent report by the Nigerian Extractive Industries Transparency Initiative (NEITI) indicates that revenue from the solid minerals sector to the Federation Account rose by 54 per cent in 2020 to N128 billion compared to N75 billion recorded in 2019.
“The fourth quarter (Q4) 2021 report on foreign trade by the National Bureau of Statistics (NBS) showed that the value of total trade in solid minerals in Q4, 2021 stood at N43.37 billion representing 0.37 per cent of total trade in Q4, 2021.
“Solid minerals exports in Q4, 2021 stood at N13.56billion, a decrease of 25.95 per cent compared to Q3, 2021 but increase by 201.41 per cent when compared to the corresponding quarter of 2020.
“These are confirmations about the potential in the solid minerals sector yet untapped,” he said.
Olawale-Cole recommended the need to address issues of fragmented legislative framework of the 1999 Constitution.
“The 1999 constitution as amended, gave the Federal Government of Nigeria, exclusive power to legislate on mining and solid mineral matters.
“However, several state governments have enacted parallel mining laws and regulations, which have continued to interfere and usurp the powers of the Federal Government and the statutory powers of the Ministry of Mines and Steel Development,” he said.
He also stressed the need to establish a robust fiscal framework for investors and address the bottlenecks due to the multi-agencies regulatory structure in the sector.
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Olawale-Cole said that government must also tackle security challenges across mineral-rich communities in the Northern region and other mining communities which had continued to undermine production and investment.
“We must invest in refineries for minerals as we cannot continue to mine minerals and export them in their primary state.
“We need to refine and package them for export to earn more foreign exchange for the country.
“The government and private investors should secure the communities’ buy-in in the project in the spirit of environmental justice, economic empowerment and social harmony.
“This is critical in preventing the prevailing condition of environmental pollution, economic disempowerment and social dislocation being witnessed in the Niger Delta.
“This should not happen or replicated in the solid mineral belts across the country,”he said.
(NAN)
