- MCO raked-in unprecedented N25bn from 2006 to 2023 – Director General
- Convene Plenary Session to debate report, NEITI tells Lawmakers
By Francis Kadiri, Abuja.
The Nigerian Extractive Industry Transparency Initiative (NEITI) recently presented year 2021 audit report of the Nigerian solid minerals sector.
The Report leaves so much to be desired about the progress of the sector in terms of revenue generation, and strategies that must be in place if the mining sector will fulfill its expected role in the realization of economic diversification agenda of the Federal Government.
Stakeholders agreed that unbridled illegal mining operations, smuggling of mineral ores and huge financial liabilities of operating mining companies are largely responsible for the alarming revenue losses suffered by the country for many years.
This is not to say that there are no milestones, especially in revenue generation, where the country’s mineral licensing agency raked-in an unprecedented twenty five billion Naira between 2006 and 2023, a stride that represents a significant percent of the total revenue generated by the mining sector to the coffers of government during the period under review.
Earlier, in an exclusive interview, former Director of Registry at the Mining Cadastre Office (MCO), Dr. Mrs S. L 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 an outcome of the success of the country 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 revenue collection,’ she said.
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 every nation generates 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.
‘So, it is on record that geosciences data generated by 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 said, noting 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.
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.
Executive Secretary of NEITI, Dr. Orji Ogbonanya Orji, said the only way the report can work its work is that it be debated by lawmakers in plenary, so that all those who are involved in revenue evasion be brought to book even as NEITI identified 40 entities in this regard.
He called on the Senate and House of Representatives to carry out their functions in line with the law. According to NEITI Boss, mining companies currently indebted to the tune of over one billion Naira in revenue to the Federal Government.
The illegal mining challenge underscores the need for the ministry to match its word with action by swinging into action by mines surveillance taskforce and Mines Police who will ensure law and order in the mine fields.
Chairman, Senate Committee on Solid Minerals, Steel Development and Metallurgy, Senator Osita Ngwu underscored the importance of choice, strategy and diplomacy in the quest to attract foreign investment to the country’s solid minerals sector.
He said: ‘The Minister is currently in Australia, and it shows that the current administration is now putting hand into this very important sector,’ adding that ‘by the time the minister returns from Australia, Nigeria would have a lot of investments that will be the result of their visit to Australia.’
According to Committee Chair who represents Enugu West Senatorial District in the 10th Senate, the Federal Government must put in place, strategies that will ensure that only responsible foreign investors operate in the sector.
While calling on government to put in place, strategies that will guard against the influx of irresponsible and lawless foreign investors, Ngwu expressed concern that some foreign investors are raping the country of its mineral wealth and fail to pay revenues due to government.
Maurice Mbaebi, who represented the Secretary to the Government of the Federation, said: ‘NEITI’s the report has come at a time when the Tinubu administration is fully committed to diversifying the economy through deliberately prioritizing the non oil sectors.
Executive Secretary, Solid Minerals Development Fund (SMDF), Hajia Fatima Shinkafi said: ‘The report is timely, and will help to engage the public and private sector to formulate the right kind of policy for future implementation while also increasing revenue and better performance for the sector in general.’
Director-General, Mining Cadastre Office, Engr. Obadiah Simon Nkom who was represented by the Director of Concessions at the Agency, Engr, Mustapha Mani Yusuf described the NEITI Report as ‘very significant in the quest to ensure that everybody sees what is happening in government and public resources. He said ‘from 2006 to July 2023, MCO generated over twenty five billion Naira to the country’s coffers,’ adding that the agency has made significant contribution to the revenue generated by the mining sector during the period under review.
It is pertinent to note that in the past fifteen years, the solid minerals sector yielded over 800bn Naira to the Nigerian government with over 193bn Naira generated in 2021 alone representing the contribution of 2.6% to the country’s GDP. During the period under review, 142.54bn tons of solid minerals was exported out of the country with a free on board value of $101.29m, according to the report.
The Report placed the solid minerals contribution to export value in 2021 at a mere 0.24%.
Awaji-inombeth Abiante who represented the Speaker, House of Representatives, said: ‘We desire that Nigeria should get a lot more from the mineral sector in terms of revenue, transparency, and we would still interrogate the report,’ adding that henceforth, every gap noticeable relative to legislation will be breached.
Chairman, House Committee on Petroleum Resources, (Downstream) said that as required by the NEITI Act, the House of Representatives will convene public hearing on the recommendations made by the NEITI Report. ‘We will ensure that people that defaulted are made to face the full weight of the law, and we will work to strengthen the NEITI law,’ he added.
The objective of the 2021 NEITI Report is to identify and block revenue leakages, and ensure that revenue get to government as they should. It also clearly indicates the quantity of minerals produced and utilized in the country.
The report also established the revenue paid by oil, gas and mining companies and how much of such revenues were actually received by government.
Stakeholders, including Civil Rights Organisaions, public and private sector and donor agencies were present to witness the unveiling of the Report.