On behalf of the Council, Executive and the entire members of Nigeria Chambers of Commerce Industry Mines and Agriculture I welcome you all to this one-day Mining Forum. But before I continue let me thank the Chief Executive officer of Walled Resources Nigeria Ltd, Chief Oyewola Oworu a veteran of the Nigerian Mining sector who is here with us to share his knowledge and experience which span over 40 years. I also wish to thank the Chief Executive of the Rock Post Mining Magazine Nigeria’s premiere publication for responding to our call. The same goes to Alhaji Mohammed Sanni President of the Miners Association of Nigeria who is well known in the Nigerian Mining circuit for his significant contributions. Others who are here and who have made this event possible are the representatives of the Federal Ministry of Mines and Steel Development including the Director General of the Mining Cadastre and other from the Stock Exchange and Law firms. We appreciate your presence at this Forum.
Background and the Context for Action
We have always had a Mining Group since the establishment of NACCIMA. It oversees the activities and the interest of our members who operate in the Mining Sector of our economy. But our decision in NACCIMA to hold this Forum which is the First in the series on the Nigerian Mining sector is inspired by our primary mandate as the Voice of the Nigerian Business and our position as the National and Premier Chamber whose activities cover the main sectors of the Nigerian economy, Commerce, Industry Mines and Agriculture. The Nigerian Mining sector has been repositioned in the quest diversify the Nigerian economy with due attention to mining. We are therefore of the firm view that we must rise to the occasion especially and taking note of our demand that the Private sector must be given the opportunity to play a more prominent role in the economy and we see this event as part of our readiness to rise to the occasion and play our role into the unfolding revolution in the mining sector. This infact also inspired us to embark on a Mining Roadshow to Melbourne and Perth Road in Australia in August 2018. It was to learn from the Australian experience in mining and also to market Nigeria’s new mining potentials and I am happy to say that the response from the Australian Investors and Nigerian in Diaspora in Perth was very encouraging.
But before I continue, let us briefly go back memory lane. Historically from the 1940s up to the 1970s mining used to make significant contributions to the Nigerian economy. During British colonial rule Tin was actively mined in Jos, Plateau, Coal in Enugu, and Gold and limestone were actively being mined across the country. This continued in the post-independence era when reportedly mining contributed as much as 4% to the nation\'s GDP. Nigerian banks then reportedly played a key role during this period as financiers at various stage of the mining process, from exploration to exportation. The discovery of oil and its rise in the 70s as the nation\'s main foreign exchange earner and the mainstay of the Nigerian economy changed all of these. The sector and others such as Agriculture were neglected and left in the hands of illegal miners, aided sometime by foreigners. The return to civil rule in 1999, the boom and burst cycle of crude oil and the determination to diversify the Nigerian economy forced a rethink. There has therefore been a sustained effort to return to Mining to harness the vast deposits of solid minerals across the nation and ensure they make significant contribution to GDP.
The Sustainable Management of Minerals Resources Project (SMMRP) and the 2016 Road Map for the Growth and Development of the Mining Industry.
The first major step in the quest to capture lost glory of the Mining sector was the SMMRP, adopted about a decade ago, through which the sector was repositioned. This was closed on the heels of Civil rule with a loan of $105 million from the World Bank. Under the project, a new structure was created; such as the mining Cadastre. The Nigeria Geological Survey Agency was reorganized and Geological survey were conducted to gather data of key minerals to determine their commercial viability. One notable programme under the SMMRP was the review of old Mining laws and the adoption of the 2007 Mining Act etc. The SMMRP helped to rekindle the interest for the development of Nigerian vast mining mineral deposits; Tin, Iron ore, Coal Goal, Gem stone, among others said to be around 34 across the length and breadth of Nigeria. It also helped to attract interest of new mining investors and FDI. The SMMRP has now been followed by the 2016 Mining Road Map for the Growth and Development of the Mining Industry.
Adopted on 30th August, 2016, the Federal Executive Council, approved “The Road Map for the Growth and Development of the Nigerian Mining Sector” with the epithet “on the road to Shared Mining Prosperity” is also receiving the support of World Bank up to the sum of $150million Dollars. Through this new Mining Road Map, the current Administration is now pursuing its campaign for the development of the Nigerian mining sector. The goal is to reposition mining in the quest to diversify the economy improve its contribution from its current paltry .033% to the GDP to at least 4.5% in the short run. The strategic Goals and objectives of the Road Map as stated are as follows:
• Development of the Nigerian Mining Sector to re-position the sector to play greater role in diversifying the revenue base of the economy, create jobs and fast tracking industrialization.
• Raise contribution of mining to GDP from its present minuscule level of 0.3% around $US400 million to 3% (about $27) billion by 2025.
• Vigorous action for exploration and mining of 7 Priority Minerals where data already exist in commercial viability, namely; Iron ore, Coal, Bitumen, Limestone, Lead/Zinc, Gold and Barite
• Sale of mined products to domestic and global markets;
• Encourage formalization of Artisanal miners;
• Promote Mineral benefaction and manufacturing;
Most notably in all of this is appeal and encouragement of the private sector to participate in this repositioning of the Mining sector that is now on-going. I am indeed glad that the Private sector is responding to this challenge.
We are aware that a company was recently established to refine gold. There are Law firms that are now investing in Tin in Jos, Plateau others are involved in exploration of Lead, Zinc and Silver across States such as Kaduna Nassarawa, Niger. Others are also on ground in Zamfara, Ebonyi, Kogi involved in Gold and Iron ore mining. Several States have set up Special Purpose vehicles or Public Private Partnership PPP arraignments to harness the solid potentials in their jurisdictions. The prospects are high and the potentials are huge because our solid minerals, if well harnessed and actively will have immense and transformative impact, not only on our foreign Exchange earnings but on Internally Generated Revenue of many States across the Federation that are endowed with minerals. Our Mining sector just like countries such as Australia, Canada and South Africa if well developed can help to improve infrastructure, Provide employment by building a mining Ecosystem that will serve the people and communities in the mining jurisdictions.
But we must remind ourselves that it is one thing to be a nation endowed with vast mineral deposits; it is another thing to be a mining nation. It requires a lot for a nation to turn its minerals deposits to a source of wealth and turn ourselves into a mining nation.
Across the world, financing mining is a difficult task. This is due to the fact that unlike crude oil, mining is a long haul and comes with a lot of risks for investors. In Africa it is even more difficult, given the problem of political instability, absence of appropriate mining Policy and environmental, Laws and regulations and lack of human Resources and expertise to handle mining administration. The issues which have been agitating the minds of prospective local investors in the private sector, in the wake of the new attention to the mining sector include the following:
• The Rights of States to minerals in their jurisdiction and issue of Royalties and Tax
• Support for Financing Exploration and Mining Operations.
• Establishment of Specialized mining financing companies
• Banking and Financing Institutions such as Bank of Industry taking due note of the critical linkage between mines and industry;
• Adequacy or otherwise of the new Mineral Export Guidelines
• Place of Private Equity,Hedge Funds, Trading Houses
• The Nigerian Stock Exchange.
• Environment issues
• Social Issues and Corporate Social Responsibility.
Above are some of the issues which require answers and I hope this Forum and the following series which will help to provide answer as we all reposition our selves in the private sector to be part of the Shared Mining Prosperity which is awaiting when our mining sector fully takes off.
NACCIMA is totally committed to the full harnessing of the potentials of our mining sector and its entire value chain. Many of our Chamber members especially in the Mining States across the federation are eager to be part of the steady unfolding Mining revolution. Some are here with us today. This Forum and others to be held are therefore significant and important and I look forward to your recommendations. Once again, thank you for coming and I wish you all successful deliberations I thank you all.
IYALODE ALABA LAWSON, MFR, FIoD, JP
National President - NACCIMA
27th February 2019
MRS. MODUPE DADA