...says the sector’s current 0.3% contribution to GDP is unacceptable
The Deputy Speaker of the House of Representatives, Hon. Benjamin Kalu on Monday said that insecurity, inadequate infrastructure, and lack of skilled labour have continued to hamper the growth of Nigeria’s mining sector.
Kalu made the assertion while delivering his address at a Public Policy Dialogue on Nigeria’s Minerals and Mining Legislation in Abuja.
He said that the nation’s vast mineral resources have remained largely untapped, and undeservedly overshadowed by our too much reliance on oil adding that despite boasting over 40 commercially viable minerals, the mining sector contributes a mere 0.3% to the country’s GDP, saying it is unacceptable.
Making reference to a bill he co-sponsored with the Chairman, House of Representatives Committee on Solid Mineral, Hon. Jonathan Gbefwi titled Nigerian Minerals and Mining Act (Amendment) Bill as well as eight other mining bills, Kalu said that the bills when passed into law will represent a turning point for the nation’s mineral wealth.
The deputy speaker also noted that governments hold many of the levers to deal with the great challenges, adding however, that businesses have the innovation, technology, and talents to deliver the needed solutions.
Kalu also opined that the governing philosophy in the mining sector in Nigeria should henceforth be approached with a private-sector-led lens, stressing that it is through this crucial partnership that the true potential of Nigeria’s mining sector can be unlocked.
He said “This public policy dialogue is engineered to create the appropriate right of way for the necessary adjustments and policymaking creativity that is required to optimize the promising prospects of Nigeria’s mining sector. Today, I stand before you not only as Deputy Speaker of the House of Representatives but also as a co-sponsor of the HB.751: Nigerian Minerals and Mining Act (Amendment) Bill so ably sponsored by Hon. Jonathan Gbefwi. This legislation if passed will represent a turning point for our nation’s mineral wealth.
“There are indications of a renewed vigor in our mining industry, fueled by a collective will to diversify our economy, create jobs, and unlock the immense potential that lies beneath our soil. The 2016-2025 mining industry development roadmap, aiming to increase the sector’s GDP contribution to 3% by 2025, is already showing progress. Projects like the Segilola Gold Project in Osun state governed by a private-sector-led lens are injecting millions of dollars into our economy and attracting much-needed investment.
“To demonstrate this concisely, in the 3rd quarter of 2023, the Segilola Gold mine in Osun state, Nigeria’s first industrial-scale gold mine posted $118 million in revenue for its owners, Thor Explorations Limited after reporting $71.7 million in earnings before interest, taxes, depreciation, and amortization (EBITDA) in 2022 according to its publicly available financial statements for 2022 and 2023. Initiatives like the simplification of licensing and competitive royalty regimes attract global players like Thor Explorations, showcasing the potential for an industrial-scale mining sector. However, challenges remain. Insecurity, inadequate infrastructure, and a lack of skilled labour continue to act as bottlenecks. This is where the HB.751 and eight other mining-related bills currently under consideration come in.
“They are not just amendments; they are a comprehensive reform package designed to address these challenges and propel our mining sector into the future.
“Here’s what these bills aim to achieve: Enhanced security: By fostering collaboration between mining companies, communities, and security agencies, we can create a safer environment for investment and development. Infrastructure development: We are committed to investing in critical infrastructure like roads, railways, and power, making mine operations more efficient and cost-effective. Skilled workforce development:
“We are building partnerships with educational institutions and industry leaders to equip Nigerians with the skills they need to thrive in this sector. Streamlined regulation: The new legislation will simplify bureaucratic processes, reduce red tape, and create a more transparent and predictable regulatory environment”.
In a goodwill message, Nasarawa State governor, Alhaji Abdullahi Sule said if Nigeria is serious about the future of the country, it must reform the solid minerals sector and review its policies to benefit the people.
He said solid minerals were more than oil adding that now that the debate about doing away with fossil oil has gained currency, the nation should utilize the mineral resources that abound in every state of the nation lamenting that the majority of them were untapped.
In his welcome address, Chairman of the Committee, Hon. Jonathan Gbefwi Gaza (SDP, Nasarawa) said the dialogue is necessary to address key priority areas to improve the sector saying “The key priority areas were identified, the common denominator between various priorities was the need for better governance.
“Thus, the Committee focused on a deep analysis of the ministry’s 7-point agenda. The interest of regulatory bodies and agencies in drafting legislation that addressed priority areas and was also implementable”.
He said “The establishment bill for a Solid Minerals Development Company, which allocates 75% ownership to the private sector and 25% to the federation of Nigeria out of which 25% boost to the public breakdown is our recommendation, and we hope that you help us solidify the bill.
“Community Development and the Environment are really prioritised in the bill. The Petroleum Industry Act (PIA) sets aside 3% of their annual operational expenditure to host communities.
“In the Bill, we have set aside 5% of the revenue of all minerals mined to the host communities, and this is due to the informality of the sector. We believe that it can be reviewed and improved through this programme.
“We also incorporated more efficient policies to enforce the environmental remediation fund to ensure that host communities are not left with deplorable sites and that the environment is adequately protected and restored after mining activities.”
In a vote of thanks, the Executive Secretary of the National Assembly Library Fund, Hon. Henry Nwawuba expressed the commitment of the library to organise more such engagements in the future.