In this report, critical stakeholders discuss how best to sustain the gains of policy reform, maximize inter-agency collaboration, block revenue leakages, and sustain the gains of economic diversification symbolized by increase in mining sector contribution to the nation’s GDP.
Francis Kadiri writes.
In Nigeria, the pursuit of economic diversification has been bedeviled by various policy summersaults in a solid minerals sector where successive governments failed to demonstrate the political will and self-denial required to do the right things, to take the bull by the horn.
Investigation by our correspondent shows that mining industry experts agree that one major drawback of economic diversification is the fact that policy makers do not have sufficient understanding of how the mining sector must work-in-sequence to generate sufficient revenue that will mean economic diversification.
Until recently, successive Federal Governments have either put the put the cart before the horse, or lacked the political will needed to put the horse before the cart. What this means is that by pursuing economic diversification while having failed to invest in geoscience data sourcing, many governments failed in the quest to attract FDI to the mining sector, because they failed to do things in the right order.
In wild geese hunts, mining sector policy makers invested funds and time in travels and eloquent presentations at international mining investment fora. Although the motive for the efforts remains commendable, but it could best be described as inviting investors to a supermarket which had its wares in the storeroom, not on the shelves.
As such, economic diversification remained a wild geese hunt while it was commonly true as pronounced that Nigeria is blessed with enormous solid mineral resources.
In discussing the state of the sector with regards to revenue generation, stakeholders agree that recent reforms, coupled with inter agency collaborations have played key roles. This is evident in ground breaking outcomes in revenue scored by the sector in the operations of the Nigeria Geological Survey Agency (NGSA) and the Mining Cadastre Office (MCO) in recent time.
In an exclusive interview, Chairman, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Engr. Auwal Ibrahim Bununu attributed the increase of mining investments in the country to ‘the working relationship between the NGSA and MCO,’ saying that Agencies in the sector should take a clue from it.
While saying that economic diversification via the mining sector is chiefly about increasing the revenue generated by the sector to the GDP, he explained that the success in strategic pursuit of geoscience data by the NGSA in the past six years gave impetus to revenue generated by the MCO during the period under review.
‘Apart from being Chairman of NACCIMA, I am an investor and I understand the sequence of developments that must lead to huge revenue generation in mining,’ Bununu said, adding that ‘through internal reforms supported by the NIMEP project, NGSA was able to generate information on the solid minerals of Nigeria,’ adding that the availability of the mineral information continued to attract mining investors to the country.
Discussing NGSA reforms in geodata sourcing and publicity in relation to reforms in mining cadatsre administration, Bununu explained that ability of the Federal Government to put in place a National Geodata Center of the NGSA is an effort on the same pedestal with MCO’s online cadatsre administration, stating that the Geodata Centre will provide real time mineral information to prospective when commissioned for use.
Bununu said: ‘The NACCIMA is waiting for FG to commission the Geo Data Centre so that investors around the world will have real time easy access to mineral information the same way prospective investors can apply for mineral titles via the online platform of the MCO.’
Bununu said despite the well-defined different mandates of the NGSA and MCO, the synergy between the Agencies in sharing of mineral information has helped to maximize influx of investors during the period under review.
Bununu said other efforts that aided geo data sourcing by the NGSA include efforts to support mining investment drive, adding that the NGSA convened mineral promotion workshops across the six geo political zones of the country. He said in February 2023, the mineral promotion workshops attracted over 400 potential investors and the testing of more than 100 mineral samples.
‘NGSA is in partnership with NACCIMA. It is also in collaboration with AFRIGIST to train staff on use of geospatial information science and technology in map production. He discussed the NGSA geochronology project with Cutin University, Australia saying it will help to know the kind of mineralization in parts of the country.
‘The agency also purchased new drilling rigs. It further engaged the academia on the First-ever Lithostructural Map of Nigeria. There was staff training on Aeromagnetic and Radiometric surveys. There was also the Bitumen exploration project that aided FGs auction of bitumen belts in the country.
‘JORC is a standard in the industry and the Agency trained its staff on JORC compliant mineral reporting. There were staff training on drilling in basement terrain among others. The Agency also installed seismographs for monitoring earth tremors and they were ready to response to the purported explosion in Ondo State by deploying technical expertise.
THE TRUTH reports that as part of results of efforts made to maximize reforms in mining cadastre administration, the MCO raked-in unprecedented N25bn from 2006 to 2023, a figure that represents the highest revenue generated by the agency within the period of time.
According to analysts, the period of this investor-boom conveniently accommodates the six-year period when the NGSA supervised the NIMEP Project that supported the Agency’s effort at mineral exploration leading to the achievement of a recorded geodata sourcing that was not achieved within the same timeframe in over 100 years existence of the NGSA.
In an exclusive interview, former Director of Registry at the Mining Cadastre Office (MCO), Dr. Mrs Sidikat Salawu analyzed the significance of the NGSA to MCO in revenue generation.
While commending the MCO for digitizing mineral licensing to support mandate success, she noted that the resounding success of the MCO in revenue generation should be correctly understood as one of the outcomes of the success of the Federal Government in Geological Survey and Geoscience Data generation, adding that the significant generation of geo data by the NGSA in the past six years is significant, and is a key source of encouragement to investors.
According to her, ‘it provided investors with the mineral information they need to invest in Nigeria.’
‘I am not a layman in the sector, I would not just look at an agency and expect it to give me so much revenue. In discussing revenue, someone who understands how the sector works would first look at the mandate of the organization, and then evaluate it within the context of tax payers and revenue collection,’ she said, noting that Geological Surveys are chiefly responsible for mineral exploration.
While calling for more collaboration between the NGSA and the MCO, the former Director of Registry said: ‘By its mandate, NGSA is not really expected to generated revenue, rather, its mandate is to generate geo science data on various minerals.’
‘All over the world, the Geological Survey of nations generate data that principally drives investment in mining. This is because geo data is the first thing any prospective investor will search-for when he is contemplating to invest in the mining sector,’ she added.
Dr. Salau agreed with Engr Bununu that the geosciences data generated by the NGSA in the past six years has never been generated by the agency within the same timeframe in the over 100 years existence of the organization. She noted that the ‘influx of investors that MCO is welcoming is a result of the volume of geosciences data generated by the NGSA in recent time.’
Salau, who said the role of institutional synergy cannot be overemphasized, said its effect is best visible in the results produced by the NGSA-MCO synergy that led to a period of boom that must be sustained.
Although stakeholders agree that there is room for improvement especially that the Minister of Solid Minerals Development, Dele Alake while unveiling his agenda for the sector, said the Tinubu administration will plow the sector to generate no less than 50% in revenues to the coffers of government. To this end, stakeholders at the NEITI event agreed that milestones must be sustained and improved upon to ensure sustained progress of the sector, while grey areas must also be addressed.
Dr. Salau stated: ‘The influx of investors is not a coincidence and it is not a surprise to those who understand how the sector works. The rush is the result of effort in geoscience data generation, good publicity for mineral information that met the preparedness of the MCO to welcome investors.’
She said while the MCO deployed electronic mining cadastre system as a world class gateway for prospective investors, the NGSA leveraged on NIMEP and other internal efforts (such as strengthening of its laboratories and investment friendly policies) at revenue generation to provide ample geoscience data (on various minerals) needed by investors to make investment decisions on Nigeria.
In an exclusive chat with Nigerian geologist and former Chairman of the Solid Minerals Development Fund (SMDF), Uba Sa’idu Malami, he said any effort at economic diversification that does not prioritize Federal Government’s sustained investment in geoscience data, will not be impactful. According to him, the resounding success of the National Integrated Mineral Exploration Project (NIMEP) which was satisfactorily supervised by the Nigerian Geological Survey Agency (NGSA), is an effort that should have been continued. Malami, who lamented that the NIMEP project was halted, discussed the significance of government’s direct involvement in geo data sourcing, saying: ‘When the Federal Government of a country drives mineral exploration, when a national government directly invests in geodata sourcing like FG did via the NIMEP project, it has a significance; it shows that the investment destination-country is committed to safeguarding its own investment and other foreign investments in that sector.’
Malami, who spoke shortly before ministerial portfolios were assigned to the ministers-designate, called on the administration of President Bola Ahmed Tinubu to invest more in geodata to strengthen the country’s chances of attracting FDI to mining sector. He said JORC-certified geoscience data on critical minerals of Nigeria (such as lithium) should be determined and presented to global investors.
