Image
Saturday, 04 January 2025 09:20

[OPINION] Alake and Matters Arising in the Mining Sector - Okey Ikechukwu

 

Let us start the new year on this column by looking at the mining sector and some matters arising therein. This is particularly important because of the much-talked-about need for alternative streams of largescale income for the nation. About two weeks ago the ban on solid minerals exploration and exploitation in Zamfara state was lifted by the federal Government. This was coming after more than five years of a “no fly and no go” zone imposed on the state’s miners, mining sites and environs, in 2019 by the Buhari government, due to serious security and humanitarian concerns.

Zamfara State and its home of large-scale gold mining, known as Bukuyum, is a place I have visited in the past. The grinding poverty and visible misery in that mineral-rich community presents a frightening contrast to the billions the land yields up on a regular basis to both legal and illegal miners. The long table of food times laid out at the local government headquarters during the visit was raided by half-clad, desperately hungry and partly bewildered looking children and youths. Some of those who helped to lay the table and place the food and plates joined in the free for plunder of the meal table. It was a pitiful sight to behold.

The expectation at the time the Federal Government imposed a ban on mining activities in Zamfara State, under President Buhari, was that the activities of bandits, and other security concerns, would abate in the wake of the ban. Many observers justifiably considered it a short-term emergency measure, especially given the perceived linkages between banditry and illegal mining activities in the area. But the expected gains did not materialize. Meanwhile, the ban was not lifted.

The decision to lift the ban last year was based on the current government’s perception, as announced by the Minister for Solid Minerals Development, Dr. Dele Alake, of “significant improvements in the security situation” across Zamfara state. It would appear that this development arose from new, intelligence-driven, and better-coordinated, security operations that led to the progressive and visible elimination of major leaders of criminal gangs and leaders of bandit groups.

The observable reduction in incidents of insecurity, as well the elimination or capture of some of the most wanted bandit commanders, like Halilu Sububu, in open and covert operation gave fillip to the recent decision to resume mining activities in Zamfara. But the essential point for me in all of this is the fact that the nation stands to gain much by the revitalization of mining activities in the Zamfara axis. Of course, with the necessary security, regulatory and other logistical entablements in place to guarantee sustainability.

While the ban lasted, the miners who were officially and formally granted lease by the mining cadastral office to carry out mining activities had to hands off, and stay off, the area. While these duly recognized miners were held in abeyance by the ban and the law, the space they left unmanned was taken over by non-state actors like bandits and illegal miners. The proceeds of these questionable mining activities were going into the pockets of individuals, especially bandits. Sundry marauders and other socially disruptive stakeholders were also the beneficiaries.

The massive quantities of gold, lithium, copper and other associated minerals in the state were thus being mined during the period of the ban, but not in the interest of the nation or its treasury. The positive security mileage that would have come from the ban, as well as the good intentions behind it, were nowhere to be see. Instead, the ban unintentionally opened the space for unlawful activities that worsened the security problems in the area.

If the as much as 200 kilogrammes of gold could be found in the camp of the now-neutralized bandit leader, Sububu, can you imagine what has been going on with many bandit leaders like him in the last five years?

Yes, the ban has been lifted, as announced by the minister, but the illegal miners are still there. Yes, there was the Presidential Artisanal Gold Miners Initiative (PAGMI), under president Buhari, which was designed to bring the unlicensed fringe actors in the sector within a regulated umbrella. It was designed to ensure that the government and the nation block a revenue and resource leakage, in the interest of the national treasury.

But let us not forget that the whole point of renaming illegal miners and creating a presidential initiative for their “domestication” is for them to be quickly brought within the Standard regulatory Environment (SRE) established for the sector. That is why PAGMI should perhaps be reviewed in such a way that a timeline for integration and better streamlined mining sector determined.  Its relevance to the Solid Minerals Development Fund is understandable, but the ministry must decide now whether PAGMI should be retained in perpetuity.

As mining activities are now set resume in Zamfara, the minister must also consider the predicament of many companies whose facilities and machinery were vandalized and even taken over and badly damaged by illegal miners in the five years that the ban lasted. Yes, banditry is now “degraded” in Zamfara, but it is still there. The ruined communities still have many existential problems to deal with.

It is good that part of what the minster has put in place is a security tax force, known as the Mine Police, also now called Mining Marshal Police by some, to combat illegal mining and smuggling. But we must also worry about their capacities and military firepower, vis-a-vis, the bandits they have to contend with; especially bearing in mind the military grade training of some bandits. The Mining Act guarantees protection for all licensed miners, but it does not guarantee the quality, or dependability, of that protection.

Yet the good news remains. This is what the Minister had to say about the lifting of the ban: “The existential threat to lives and properties that led to the 2019 ban has abated. The security operatives’ giant strides have led to a notable reduction in the level of insecurity, and with the ban on exploration lifted, Zamfara’s mining sector can gradually begin contributing to the nation’s revenue pool”.

One thing is clear, namely, that the lifting of the ban will improve government regulation of mining activities in the state, especially after the “five years eaten by locusts”. It will also improve government revenue and give the mining sector an improved regulatory framework for effective intelligence gathering to combat illegal mining and ensure the nation benefits maximally from the state’s rich mineral resources.

As for the recent controversy surrounding the Memorandum of Understanding (MOU) Nigeria signed with France, there is no question of Nigeria relinquishing control of its mineral resources to, or entering into any military pact with, France. Not at this point in our national history. So far, available information suggests that the core of the MOU is on training and capacity building for mining professionals. Yes, we need further technical and financial capacity development and support in the sector and some of that can be provided by the French, but not at the expense of our national sovereignty.

Ours is a nation endowed with substantial solid, liquid and gaseous mineral deposits, for which extant internal capacities are not enough. We have such rare endowments as columbite, tantalite, beryl, aquamarine, lithium and tourmaline, besides gold, coal, tin, lead, zinc, limestone, granite, laterite, barite, gypsum, kaolin, marble, iron ore and wolframite. We need to bridge the gap between our natural endowments and our capacity for their exploitation. It is only through clear-eyed technical partnerships, technological support, security of the operating environment and reforms and guaranteed regulatory compliance that the sector can be taken to greater heights.

This ministry must be supported in its efforts to live up to its mandate of helping the nation to maximize the expected benefits of the solid minerals sub-sector. This sector is one sure route to economic diversification and the expansion of revenue streams for the nation.  It is only with well thought out policies, regulatory guidelines, fiscal incentives and effective partnerships that the minister can administer all aspects of mining and mineral exploitation, such as issuance of permits, licenses, leases, collection of rents, fees and royalties, prospecting, quarrying, mining, handling, sale and consumption of solid minerals. And all of this on templates that are guided by global best practices.

In addition to the aforementioned minerals, our lithium, graphite and nickel, which are vital for the global energy transition of today places Nigeria in the spotlight, because of growing interest by global investors and rising global demand for these minerals. The unique opportunity to stan d forth as a key supplier in this emerging market is here with us.

What needs to happen, in addition to the good works being done so far are: (1) Availability and accessibility of high-quality geological data. (2) Popularization of the National Integrated Mineral Exploration Project (NIMEP). (3) Improvements in critical infrastructure, like roads, rail, and power supply. (4) The leveraging of public-private partnerships (PPPs) to fund and develop such infrastructural support services. (5) The review of the existing incentives framework for mining, to determine whether it is sufficiently attractive to investors in the sector. (6) Disaggregating and evaluating fiscal and non-fiscal incentives to ascertain to what extent they are competitive and aligned with investor expectations and global industry practices.

Finally, the ministry and the minister need to keep The Nigeria Mining Week in the front row of their enlightenment and public visibility programmes. It serves as a good forum for networking in the mining sector. The connections made, the opportunities, the conferences and technical sessions from each edition offer great opportunities. Stakeholders are enriched with knowledge, stronger industry connections, and a renewed sense of optimism for the sector’s growth. The minster’s surmising, that Nigeria Mining Week has evolved into more than a gathering of industry experts and is now “a powerful forum where we refine our shared vision, aligning our goals to create a robust, self-reliant mining sector in which Nigeria’s mineral wealth serves as the backbone of economic diversification, job creation, and community development, advancing our national interest for the benefit of every Nigerian” is easy to understand.

 

 



Join us on Whatsapp Channel Subscribe to Telegram Channel