By Abdulrahman Abdullahi
Nigeria Senate President, Ahmad Lawan, has said Nigeria has a lot more to do if the country must succeed in diversifying its economy by ensuring the development of the solid minerals sector.
Lawan made this known on Tuesday in his concluding remark after a bill seeking to establish the Nigerian Minerals Development Corporation scaled second reading on the floor.
According to the Senate President, the exploration of solid minerals, besides being an avenue to diversify the country’s dependence on oil, remains a sure way for Nigeria to improve on its Foreign Exchange earnings and Gross Domestic Product (GDP) figures.
He said: “It is imperative that the Nigerian economy is diversified, and the solid minerals, definitely, is one avenue through which we can earn the much needed foreign exchange.
“I also believe that we have a long way to go, we haven’t done enough. At the moment, there are very little investments into this sector and the contribution of the sector to our Gross Domestic Product (GDP) is just about 0.3 percent, even though we are so blessed and endowed with so much solid minerals all over the country.
“This corporation (NMDC) when created will definitely work to ensure that we promote the exploration and exploitation of our solid minerals endowments.”
Earlier, sponsor of the Nigerian Mineral Development Corporation Bill 2021, Senator Umaru Tanko Al-Makura (APC, Nasarawa South) said the intendment of the bill was to strategically diversify Nigeria’s economy from being a mono-product economy to the productive development of various sectors of economy.
According to the lawmaker, “next to agriculture, the solid mineral sector has been identified as one with the potential to compete and eventually replace crude oil as a major source of foreign exchange earnings.”
He added: “the Economy Recovery and Growth Plan (ERGP) created focus labs made up of professionals from the mining sector to create intervention programmes to de-risk the solid mineral sector and increase revenue for all stakeholders, making the sector more attractive to both local and foreign investors.
“Nigeria is blessed with an abundance of solid minerals in five distinct classes; precious mineral/ gemstones (ruby, emerald etc), metallic ores (lead, zinc, copper etc), construction minerals (laterite, granite, gravel, sand etc) and energy minerals (bitumen, coal and uranium among others).
“All these resource remains largely untapped and unexplored. However, NMDC seeks to develop upstream exploration and production, midstream mineral processing and metallurgy and downstream logistics, trade and export which will catalyze investment in the entire mining value chain in Nigeria.”
Al-Makura noted that the establishment of the NMDC would urgently address the challenges of Internally Generated Revenue (IGR) currently facing State Governments in Nigeria, stressing, “it would provide the much needed revenue to deliver on the administration’s priority areas of infrastructure development; social inclusion and poverty reduction, industrialization and job creation for the citizens of Nigeria.”
He added that, “upon establishment of the corporation, initial funding shall be by way of a sovereign guarantee covering the sum of N5,000,000,000.00 (Five billion Naira only) for a successful take off of the operation including all initial capital and operating expenditure.
“The Federal Government of Nigeria would pay up its 70 percent equity contribution and the institutional investor shall pay their respective equity participation to the corporation.
“Subsequent funding of the NMDC would be through the Nigerian Mineral Development Fund (NMDF) which will be managed by the corporation strictly in accordance with international best practices.
“The NMDC is proposed to be a state-owned Enterprise (SOB) with private sector participation and governance control as the vehicle for unbundling upstream and downstream commercial activity in the Nigerian Solid Mineral sector.”
Al-Makura identified the activities and scope of the corporation to include: Mineral exploration activity for solid minerals located within Nigeria; Investment in mineral processing and metallurgical technology for import substitution and export as a direct source of revenue to the Government; Creation (Management) of the Nigerian Mineral Development Fund (NMDF); Creation of an active solid mineral exchange and all associated key enablers; and Ensure technology transfer and local content development in the Nigerian Solid Mineral Sector.
He disclosed that the strategy for the successful creation of value in the solid mineral sector by the NMDC is hinged on its partnership with Government through the Ministry of Mines and Steel Development (MMSD) and the private sector to implement a ”Mines to Market” master plan covering upstream, midstream and downstream activity.