December 28, 2019

Strengthening the mining sector via stakeholders collaboration

Strengthening the mining sector via stakeholders collaboration

In his mindset to achieve positive results and further deliver Nigerians expectations in his mandate in the mineral sector, the Honourable Minister of Mines and Steel Development, Architect Olamilekan Adegbite believes there is strength in collaboration.

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This he has done by ensuring stakeholders, meaningful Nigerians are carried along in this new initiative and concerted efforts to reposition mines in the Nigerian states. And recently the Honourable Minister, has taken the initiative of visiting state governors to smooth over relations on the issue of mining.

Why is he taking this pain to reach out to governors, Adegbite right from the day of his appointment as Minister of Mines and Steel Development, was not only targeting a sector that will increase Nigeria’s income revenue, but job creation in the country to reduce criminality, diversify the economy that would better position the country for local and foreign investment attractions for global competitiveness.

Again, he believes engaging stakeholders, governors for meaningful and result-oriented collaboration would fasttrack the effort of President Buhari and the ministry of mines and steel toward realising the objectives of the sector which had started taking a new shape for modern industrialisation where the country will begin to export wealth from the sector.

It was recently learnt from the management source that engaging some governors at this level is very important because many a time, state governments run afoul of the constitution which places mining on the exclusive list, when they interfere in mining activities.

It was also noticed that Architect Olamilekan Adegbite has already visited Lagos, Osun and Kogi state in which he had extensive talks with the governors on how they can partner with the Federal Government to enhancing mining in the states.

While speaking in Osun State, in the presence of the governor, it was recorded the minister said that ‘mining is on the exclusive list, and a constituted government should not participate in illegality. He also addressed that issue where people are saying let’s bring mining to the concurrent list. “But if we do that, the Niger Delta states will also begin to agitate that oil and gas should go to the current list, which is also a form of mining. Then the money that is shared at the federal level largely comes from oil which is gotten from the Niger Delta. If they also clamour that oil and gas should be on the concurrent list then we will have little or no money to share at the federal level.”

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However, seeing the concerted efforts of the minister, Nigerians wished if the necessary the minister needed will be given to him so that national development we are clamouring for could be a reality so that Nigerians would enjoy the benefits.

The source also revealed that despite the challenges, the minister’s plans and strategies are broadening, all encompassing even as he is now encouraging value chain creation in the downstream of the mineral sector. The minister is pushing for mined raw gemstones to be cut and polished in Nigeria instead of taken the raw gemstone abroad and creating value chain in those countries.

From what we have seen, the articulate minister doesn’t want leave any aspect of the mines and steel untouched. So, he wants to encourage the creation of value chain in the gemstone sector and other mining sector. To make this result-oriented the minister recently visited MINA STONES a pioneer of Hand-crafted Fine Jewelry who sources the stones, cuts and polish them.

A clear source from the ministry told us that, while the minister commends and appreciates the effort and zealous of President Buhari to ensure that this projects is delivered, he said that the president beliefs that the mineral sector can transform the economy and bring about diversification. The minister want to encourage the downstream of the mining sector because he want the gold and gemstones that are mined in Nigeria to be polished here, thereby creating employment opportunities for thousands of Nigerian citizens. While doing that, we were told that the minister is also working hard to ensure that people can easily apply for their mineral titles anywhere in the world through the upgrade of the Mining Cadastre Office, MCO.

Without further delay and being passionate of developing the downstream mineral, the minister had gone ahead to organise the first ever downstream mineral workshop, centred on Nigerian mineral value chain policy to move forward an initiative on responsible mineral supply value chains.

This was done based on the increasing efforts to promote responsible management of mineral supply value chains at the global level through impactful public-private platforms.

However, recognising the power in team work and the strength in collaboration, the ministry spearheaded this policy initiative in collaboration with Lagos Business School (LBS) and the Mineral sector support for economic diversification (MINDIVER).

“Mineral supply chains are essential to our everyday life, from the technology we use, our smartphones and computers, to the cars we drive and even the homes we live in. They are also crucial in our efforts to promote a more sustainable and inclusive growth. We are therefore taking a hard look at the potential for downstream processes to benefit from these enviable mineral resources.

Mining is the foundation for modern industrialization. Industrial minerals most times are used in their natural state or after beneficiation, either as raw materials or as additives in a wide range of applications. Most industries such as steel use limestone, manganese, coal as basic raw materials. Bauxite is the main raw material for aluminium industry, while the fertilizer industry relies on phosphate, gypsum. Ceramics industry is supported by clay minerals. Kaolin as an industrial mineral is used in the manufacture of paint, paper coating and filling and several such other minerals. Opportunities abound for entrepreneurs in this area”.

The Honourable Minister, Architect Olamilekan Adegbite was quoted that for far too long, Nigeria has been unwittingly exporting wealth and employment, by not adding value to our mineral sectors. “We are ready to change this narrative. We are resolved to enact policies to help develop the downstream industries that add value to our mineral resources, such as beneficiation, smelting and refining.

Mining sector is a critical sector and one of the frontiers of this administration’s priority goal of diversifying our economy’s revenue base, creating jobs, and facilitating an environment where enterprises can thrive.

Mining in Nigeria which started at about 1904 has remained largely a dream and mirage due to lack of substantial impact to the economy, wealth and job generation, this has largely remained so due to the tenuous linkages with other sector of the economy. We have identified this missing link and have resolved to develop our downstream mineral value chain to address this gap by linking mining activities to manufacturing sectors, thus diversifying the economy. The most notable benefits include developing local enterprise and creating jobs, in particular more highly skilled jobs.

The dominance of China and other Asian countries in the Nigerian solid mineral sector has contributed little to the value chain in the sector. China dominates mining in Nigeria with minimal roles for Nigerian firms. The raw minerals exported out are used to produce consumer and industrial goods for sale in global markets at much higher prices than what’s paid for the raw materials. The export of raw natural resources is a legacy of colonialism, in which countries were precluded from developing their own processing capacities in order to supply their motherland with cheap raw materials.

Our past experiences in the development of tin ore and coal value chain by the establishment of the defunct Makeri Smelting Company and Nigerian Coal Corporation with attendant infrastructural and employment generation coupled with the current exploit in our limestone exploitation for cement manufacturing are great pointers that our downstream mineral development is a possibility and can be sustained if deliberate policies are enacted and implemented.

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No doubt, the mineral downstream holds great opportunities for entrepreneurs from other sectors to participate in the mining value chain. Equipment sales and leasing Enterprises, Lawyers, Risk Analysts, and Business service consultants are needed to support new companies entering into the market with business plans, feasibility studies, market research. Also, just like in other mining jurisdictions, our industry welcomes mining specialist Blogs and Publications.

Indonesia, South Africa, Gabon, Zimbabwe, Australia and even the EU countries have formulated policies on their mineral downstream development. Botswana has largely avoided the “resource curse,” as the country’s diamond and other mineral sales have contributed to modern infrastructure, high skilled jobs and about 35% to its GDP. Nigeria can follow the same strategy, with the necessary adjustments, and harvest the low hanging fruits of resource endowment, leap-frogging to achieve the same over a shorter period. Late Kofi Annan once said, “Africa cannot build dynamic growth and shared prosperity while extractive projects operate within enclaves or countries export natural resources unprocessed.”

“Mineral value chain promotes positive economic growth when harnessed. The economic impact of mining goes beyond mineral extraction and processing. Aside from value addition to the minerals, it is also an avenue for technological advancement, job creation, government revenue growth, opportunities for local communities to share some goods and services with the mine through community development activities and trade, foreign exchange earner for the nation for economic growth and diversification.

Our beneficiation strategy shall advance national development through the optimization of linkages in the mineral value chain. This optimization is expected to result in economic diversification, jobs creation, industrialization and contribute to incremental gross domestic product growth in mineral value addition per capita.

At the current production level, we shall ensure that minerals undergo processing that improve the value of ore by removing gangue, or commercially worthless materials, which can make Nigeria mineral products higher in value and quality both for domestic usage and for export.

President Muhammadu Buhari is passionate about diversifying the nation’s economy by harnessing the potential that abounds in the solid sector. The bad mining deals that have plagued our nation in the past, especially as it relates to the intractable legal logjam bedeviling Ajaokuta Steel Company and others shall be resolved by the enactment and enforcement of good policies and legislations to sustainable development of our various minerals downstream initiatives”.

It was revealed that the minister expected a draft of clear policies that are implementable and enforceable at the end of the workshop. We are willing to give good incentives of lowering export levies for mining companies that are willing to commit to developing processing and refining facilities and give licensing supports to any investors who meet our mineral downstream criteria.

I now declare this workshop open and wish you all fruitful deliberations. I thank you all for your attention, once again welcome to a new dawn in Nigeria mining renaissance”.

Furthermore on the implementation of the up-grade and automation of MCO online application, e-recording, arching and establishment of the six zonal offices, the Mining Cadastre Office which was established by the Nigerian Mineral and Mining Act (NMMA), 2007 for the purpose of Administration and Management of Mineral Titles in Nigeria, with its reformation is targeted to developing and mainstreaming a transparent, accountable, people-oriented and environment-friendly governance model for the Mining Sector, as espoused in the NMMA, 2007. The MCO is also guided by internationally accepted principles in its mineral title administration, which includes, conclusive macro-economic environment for mining investment; clear, stable, legal and regulatory frameworks; well-defined institutional responsibilities; transparent and non-discretionary procedures; stable, competitive and fair fiscal regimes.

The MCO has witnessed tremendous legal, institutional and technological developments since its inception.

In addition, the Director-General, MCO, Engr. Obadiah Nkom, praised the leadership of Adegbite in turning around the industry in a short period.

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According to him, Arch Olamilekan Adegbite has within a short time brought hope to this industry by the steps he has taken and his collaborative approach to the sector.