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Illegal miners’ gain, Fed Govt’s pain

Nigeria has about 44 commercially viable minerals in 450 locations across the country. If properly exploited, these could be the wedge for an economy in search of alternative revenue source besides oil and gas. Sadly however, much of her mineral wealth is being plundered by illegal miners, said to be operating in about 1,759 mining sites. Stakeholders fear that without reining in illegal miners, hopes of leveraging mining to earn foreign exchange, create jobs and boost the sector’s contribution to GDP to three per cent by 2025 will not be achieved. Assistant Editor CHIKODI OKEREOCHA reports.

 

The launch in August 2016 of a new “Roadmap for the Development of the Solid Minerals Sector” gladdened the hearts of many Nigerians and industry stakeholders.

For one, the level of detail contained in the Roadmap and its precise ambitions were encouraging; it also re-enforced hopes of positioning mining to dislodge oil as Nigeria’s major revenue earner.

For instance, the Roadmap which built on its predecessor, the old 2012 Roadmap, envisaged a mining sector worth $27 billion in direct and indirect contributions – a figure that represented about three per cent of Gross Domestic Product (GDP) by 2025, up from a meagre 0.33 per cent in 2015- and over $5 billion in new investments in the intervening years.

However, the Federal Government did not stop at expressing its commitment, within the roadmap, to growing the contribution of mining to GDP to three per cent by 2025.  It also went a notch higher, identifying seven  strategic minerals of commercial quantity to be accorded priority development.

The seven minerals include coal, limestone, lead/zinc, bitumen, barite, gold and iron ore. The new roadmap, which came after the Federal Government in 2015, identified the solid mineral sector as one of the key sectors to drive economic diversification, was followed through with the constitution of the Mining Implementation and Strategy Team (MIST).

The team’s duty is to coordinate the implementation of the roadmap and programme-manage its execution. This, The Nation learnt, came after the Ministry of Mines and Steel Development took series of pragmatic steps to redefine the policy and regulatory framework for the sector.

As leading advisor to the mining industry globally and in Nigeria, PricewaterhouseCoopers (PwC) Nigeria, put it in its report titled: “Unlocking the Potentials of the Mining and Steel Sector in Nigeria,” the new mining Roadmap aspired to “build a world class minerals and mining ecosystem designed to serve a targeted domestic and export market…”

PwC Nigeria’s Head Advisory and Consulting/Mining Sector Leader, Cyril Azobu, and its Associate Director and Head Mining Sector Business Development, Habeeb Jaiyeola, said: “Ultimately, the endgame was to position the sector to contribute three percent to GDP by 2025.”

However, the achievement of this ambitious target by leveraging the 2016 mining Roadmap to force a rebound of the sector has come under serious threat by the activities of informal or illegal miners.

The illegal miners, allegedly with their foreign collaborators, seem to have perfected their own ‘Roadmap’ to pillaging the nation’s solid mineral commonwealth, much to the chagrin of the Federal Government, the Ministry of Mines and Steel Development and Nigerians generally.

For instance, a recent report by the Nigeria Extractive Industries Transparency Initiative (NEITI) put the situation in perspective when it said illegal mining was thriving in six states in the country. The states include Niger, Plateau, Zamfara, Ebonyi Enugu and Imo.

The NEITI report titled: “Improving Transparency and Governance for Value Optimisation in Nigeria’s Mining Sector” indicated that Niger and Plateau states topped the illegal mining list. While Niger State had 10 illegal mining sites, Plateau had seven.

Ebonyi and Imo states had five illegal mining sites while Enugu and Zamfara states had four sites. The exploited minerals included gold, silver, lead, zinc, tantalite, tin, columbite, barites, gypsum, sapphire, emerald, granite tourmaline, sandstone and others.

The Director, Artisanal and Small Scale Mining, Ministry of Mines and Steel Development, Mr. Patrick Ojeka, put the number of Nigerians directly involved in small sale mining operations across the country at over 500, 000.

He gave this figure in Calabar, Cross River State, during a five-day training for 150 registered and performing mining cooperatives and quarry associations in the Southsouth and Southeast regions.

Ojeka said the number was on the increase in view of the Federal Government’s strategy in harnessing the potential of mining to address poverty in rural mining communities.

The Minister of Mines and Steel Development, Mr. Olamilekan Adegbite, brought the reality of the thriving illegal mining business nearer home when he said illegal miners were operating in about 1,759 mining sites across the country.

The minister, who gave this figure at an event that brought stakeholders in the sector together in Ekiti State, had earlier alleged that some governors were behind the illegal mining of some solid mineral resources in the country.

Adegbite, at a recent interactive session, told the Senate Committee on Solid Minerals, Mines, Steel Development and Metallurgy, that illegal mining was allegedly being supported by some state governors, as demonstrated by their provision of police escort for unlicensed foreign miners in their jurisdictions.

Read Also: Experts seek involvement in Ajaokuta steel resuscitation

 

Although, the minister did not specifically mention the governors behind the illegal act, he condemned the “unholy” alliance of the governors with some foreign miners who were operating illegally in the country.

Adegbite said: “You will find foreign nationals encouraged by our people. Without naming them, we have some state governments that are encouraging these foreign nationals that we are talking about. That is why you see them with security (operatives).

“When they send them to go and do this, they need police. What do you expect a mining officer to do when the state government is backing illegal mining?”

However, as part of efforts at curbing illegal mining activities, the minister noted that the government had been engaging mining operators in the communities to lure them into formally registered cooperatives for the purpose of safely mining the nation’s resources.

Indeed, the ministry, under Adegbite’s charge, had as part of the re-launch of Nigeria as a mining destination, not only moved to formalise artisanal miners, but also committed to helping artisanal and small-scale miners to access funds.

The move appears to be bearing fruits. For instance, Adegbite said more than 1, 500 Artisanal Mining Cooperatives (AMCs) have been registered nationwide, just as about 250 Private Mineral Buying Centres have been registered to facilitate trading in mineral commodities.

Also, to ensure environmental mitigation in the mine fields, Adegbite said Environmental Laws and Regulations are being enforced to the letters.

According to him, the recent second International Conference on Artisanal Gold Mining with Lead, organised alongside with Medicines San Frontiers (MSF), provided the platform to strategise on how to prevent lead poisoning associated with artisanal gold mining.

The ministry’s efforts have not gone unnoticed. Azobu and Jaiyeola, in the PwC report earlier cited, admitted that efforts to curb illegal mining have been ramped up by the provision of surveillance vehicles for Mines Inspectors across the country and increased inter-agency co-operation.

PwC also said the issue of illegal mining is being tackled through the establishment of the Mines Police Division, as well as the emergence of the Joint Task Force on Mines surveillance including officers of the Police and the Nigeria Security and Civil Defence Corps (NSCDC) working closely with all the state mines offices.

This, according to the multinational mining industry advisor, was “to put an end to criminal activities in the mines and ensure safety of lives and investments including compliance with laid down procedures and environmental standard requirements.”

The company noted that this has led to some arrests of local and foreign illegal miners, adding that there has also been support for revamping the operations of Mineral Buying Centres across the country.

PwC was, however, noted that “unfortunately, solving the menace of illegal mining in Nigeria also requires efforts by the international community in stifling illegal sale cartels majorly driven by foreign interests.”

PwC no doubt, laid credence to fears that the thriving illegal mining activities in the country enjoy the strong backing of some foreign interests. The local perpetrators of the illegal act, The Nation learnt, are mostly poor, unemployed rural dwellers.

They also use crude methods and household implements to exploit the solid minerals. Besides, they do not have the expertise or capacity to go through the sustainable processes of the mineral value chain for the delivery of optimum economic benefits to themselves or the nation.

As a result, much of the mineral commodities illegally mined are exported in crude form to European and Asian countries at give-away prices, without any value addition, to the disadvantage of the national economy.

What this means is that the economies of other nations are being developed, both in terms of revenue earnings and job creation, at the expense of Nigeria’s. The absence of globally recognised mining companies in Nigeria is widely believed to be partly responsible for the upsurge in illegal mining activities.

 

Digging hole in govt’s purse

Currently, about 80 per cent of mining activities in the country are said to be illegal, depriving the various tiers of government of billions of Naira in supposed royalties annually.

For instance, between 2016 and 2018 alone, Nigeria lost about N353 billion in gold smuggled out of the country and sold in the international market without any revenue accruing to the government.

Within the three-year period, about 18 tons of gold were smuggled out of the country and sold in the international market, according to  the former Minister of Mines and Steel Development, Alhaji Bawa Bwari.

Bwari, who confirmed that six tons of gold originating from the country  were traded in the international market on an annual basis, said the trade did not benefit the country as it made no impact on the nation’s GDP.

When added the billions of naira government spends on remediation processes on lead poisoning and other environmental hazards caused by illegal mining in various states of the federation, the cost is indeed, humongous.

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