- Stakeholders seek 10% revenue for communities
The Federal Government has restated its commitment to transform the solid minerals sector into a key driver of economic diversification under the Renewed Hope Agenda.
Minister of Solid Minerals Development, Dr Dele Alake, who re-echoed government’s commitment at the opening of the African Natural Resources and Energy Investment Summit 2024 (AFNIS24), in Abuja yesterday, also outlined a multifaceted approach focusing on policy reforms, sustainable practices, infrastructure development and human capital enhancement.
The reforms, according to Alake, are aimed at creating a conducive environment for investment, enhance transparency, regulatory clarity, enhance investor confidence, and as well foster a thriving and competitive industrial sector.
Also, stakeholders at a public hearing in the House of Representatives yesterday, canvassed 10 per cent revenue for host communities of solid minerals in the country.
This was part of recommendations in the hearing which was organised by the House Committee on Solid Minerals chaired by Hon Jonathan Gaza.
As part of repositioning the solid minerals sector, Alake emphasised the importance of sustainable infrastructural development, adopting best practices that minimise friction in the business environmental, and that promote social responsibility.
He said government plans to encourage investments in transportation, power supply, and technological advancements, and enhance the capacity of the workforce through training and education.
“Under the Renewed Hope Agenda, championed by President Bola Ahmed Tinubu, we are committed to transforming Nigeria’s solid mineral sector into a cornerstone of our nation’s economic diversification strategy. Our approach is multifaceted, focusing on policy reforms, sustainable practices, infrastructure development, and human capital enhancements.
“We are currently implementing comprehensive reforms that will create a conducive environment for investment in solid mineral sector. These reforms, aimed to enhance transparency, regulatory clarity and investor confidence, fostering a competitive and thriving industry. This aligns with Mr. President’s vision of an open and transparent government that works for the people of Nigeria.
“Our commitment, thus, to sustainable and infrastructural development is unwavering, we are adopting best practices that minimize environmental impact and promote social responsibility. Our goal is to ensure that mining activities contribute positively to the economy while safeguarding the environment and enhancing the well being of local communities, reflecting the ethos of the Renewed Hope Agenda.
“Recognizing the critical role of infrastructure in enabling mining activities, we are going to encourage investments in key projects including transportation, power supply, and technological advancements. These investments will facilitate efficient extraction, processing, and transportation of minerals, thereby boosting productivity and competitiveness.
“As building a skilled workforce is so essential for the success of the solid minerals industry, we will continue to enhance the capacity of our workforce through training and education, ensuring that our people can participate meaningfully in the industry and drive its growth. This is a line again, with President Tinubu’s commitment to creating opportunities for all”, the Minister said.
The Minister also announced Nigeria’s chairmanship of the newly established Africa Mineral Strategy Group, aimed at setting new standards in Africa’s mining industry.
He said the strategy group’s goals will include ensuring equitable sharing of Africa’s resources, promoting sustainable practices, and fostering international collaboration in the mining sector.
He expressed gratitude to participating countries, highlighting the collective commitment to sustainable development of Africa’s natural resources.
Alake stressed the importance of collaboration, expertise, and insight in forging a path towards a prosperous and sustainable future for Africa.
“It is with great pride that I highlight Nigeria’s leadership role in the newly established Africa Mineral Strategy Group. As the first chairman of this initiative, I am dedicated to setting new standards in Africa’s mining industry and ensuring that Africa’s resources are equitably shared, and Africa has its own commensurate share in supplying the world with critical minerals.
“This initiative will drive economic growth in Africa promote sustainable practices and foster international collaboration in Africa’s mining sector. We are therefore very deeply grateful to all the countries that have honoured us with their presence at AFNIS , 2024
At the hearing in the House of Representatives, stakeholders argued that the 10 per cent revenue would ensure the host communities derive the economic benefits for solid minerals extraction in their environment where the mining activities take place.
They also proposed a 10-year renewable mining lease instead of the 25 years as captured in section 66 of the Solid Minerals Mining Act 2007.
Mr Tobias Lengs of RENEVLYN Development Initiative decried the health hazards, the environmental degradation and the negligence of the miners that pose a danger to host communities.
“We suggest an upward review of the extraction net value revenue that goes to the Community Development Association. 10 percent is suggested and this should be reviewed periodically.
“The duration of a Mining Lease is twenty-five years , and shall be renewable every twenty-four years as captured in section 66 of the Solid Minerals Act. The 25 years mining lease arrangement is too long and leaves room for operators to get away with impunity at huge cost to the nation. A 10-year mining lease is proposed instead to compel operators to be more responsive and accountable for their actions,” he said.
He further suggested that the community development agreement should be flexible to allow the host community to determine exactly what they want to use the funds for without tying it to particularise line items.
Ms. Lumun Amanda Feese who represented Nigerian Economic Summit Group (NESG) said despite the enactment of modern legislation for the mining industry not much has been achieved economically.
“The mining sector’s impact on the economy remains suboptimal, hovering below one percent of GDP by 2015. In 2016, the government approved an industry roadmap aimed to enhance the sector’s role as an economic driver, targeting a three percent GDP contribution by 2025.
“The NESG would like to commend the House Committee for initiating these bills to address the staggering decline of the mining
sector. While both bills are noteworthy, the NESG emphasises an urgent need for the Federal Government to instil the highest
standard of good governance in the mining industry.
“This call is similar to the government’s successful approach in the oil and gas sector demonstrated through the Petroleum Industry
Act (PIA) of 2021 to implement the Nigerian oil and gas policy,” he said.
The chairman of the Committee, Gaza noted that the proposed legislation is necessary to transform the mining sector.
The Speaker, Tajudeen Abbas, said the mining industry plays a vital role in the economy, contributing significantly to government revenue, employment generation, and foreign exchange earnings.
“The sector holds immense potential for driving industrialization, infrastructure development, and overall economic diversification.
“However, despite its immense potential, the sector faces numerous challenges that hinder its growth and impact on national development.
“It is imperative that we address these issues through comprehensive legislative reforms that will create a conducive environment for sustainable mining practices,” he said.
