The Nation Newspaper

Tag: mining

  • FG plans intervention fund for mining

    FG plans intervention fund for mining

    The Federal Government is to present an intervention fund to be accessed by operators in the mining sector.

    Minister of Mines and Steel Development Dr Kayode Fayemi addressed participants at the opening of the National Council on Finance and Economic Development (NACOFED) in Abeokuta, Ogun Statey.

    He said the intervention fund would be sourced from the National Resource Fund, which is 1.6 per cent of the Federation Account, set aside for agriculture, solid minerals and water resources.

    Dr Fayemi said President Muhammadu Buhari had given the ministry access to part of the fund.

    The minister, whose paper: “The Non-oil Sector as a sustainable alternative in enhancing revenue generation”, attracted questions from participating commissioners of Finance, said funding was a major challenge in the sector.

    Dr Fayemi, however, hoped access to the intervention fund and that from banks would lift the sector.

    The minister lamented that the past administration denied the sector  access to the Natural Resource Fund.

    Dr Fayemi announced that stateswould now benefit from 13 per cent derivation from mining revenue.

    “This is a significant shift that signposts our commitment to facilitating a win-win situation for stakeholders”, the minister said.

    In deepening the ministry’s partnership with states, he said there were arrangements to establish a Council of Mining and Mineral Resources as a quarterly forum involving the minister, commissioners responsible for mining and natural resources as well as other relevant government officials.

    “The forum would be an avenue to discuss pertinent issues in mining, which is of concern to governments. It will also allow us to track progress on agreed areas of collaboration”, Fayemi said.

    The minister unfolded the ministry’s plan to set up zonal offices of the Mining Cadastral Office, so that its operations get closer to the states.

    “Finally, we will work with states to find commercial means for them to co-invest with private companies to bring mining assets to market faster and more profitably.”

    The minister assured states that the right regulative frameworks were being put in place to ensure that investors comply with global best practices in resource extraction by integrating relevant protocols on environmental conversation in mining and related business.

    “This is why ecological justice is one of the major planks of our approach to the re-positioning of the solid minerals sector.” The minister added.

  • Mining: Fayemi woos investors with three years tax holiday, others

    Mining: Fayemi woos investors with three years tax holiday, others

    Minister of Mines and Steel Development Dr Kayode Fayemi yesterday offered prospective investors in the mining sector three years tax holidays, as part of Federal Government’s incentives to serious investors.

    The tax holiday, according to the minister, would commence from the date the investor starts mining operations in the country.

    Speaking at the opening session of the on going Africa Down Under Conference in Perth, Australia, Dr Fayemi said the country was determined to return stronger to the global ore and mineral market and would drive the growth and development of the sector through the private sector.

    The Minister listed other incentives approved by the Federal Government for investors in the mineral and mining sector to include exemption from custom and import duties on mining equipment.

    Other incentive available to the foreign investors is that companies could be wholly owned by such investors.

    Fayemi also identified security as another major area the government was investing in, in order to ensure security of investment as well as life and properties.

    “Our government has a renewed commitment to the improvement of security across mine site, logistic related security and general terrorism.”

    The minister said: “We are focusing on rebuilding our minerals and mining sector in three phases: Phase 1, in the immediate term, we are achieving import substitution by winning over domestic users of industrial minerals.

    “Phase 2, our focus is on further expanding our domestic ore and mineral asset processing capacity. Phase 3, we will return stronger to the global ore and minerals markets at a market competitive price point.”

  • Deepening potential in mining

    Nigeria has the capacity to generate at least N5 trillion yearly from the mining sector and export of its vast solid mineral deposits. Stanbic IBTC Bank is focusing on how to deepen the sector, which creates jobs and social infrastructure needed for national development, writes COLLINS NWEZE.

    Mining remains one of the most promising sectors of the economy with the potential to generate over N5 trillion yearly for government, especially from exporting its solid mineral deposits.

    Banks with foresight and passion to improve the lots of the economy are targeting the huge funding potential in the mining sector and helping government realise its economy diversification plans. The Stanbic IBTC Bank Iron and Steel Business Session was organised by the lender to jumpstart sustained interface between the private sector and government with a view to developing a robust mining sector through the public private partnership model.

    This has become necessary because the economic downturn, triggered by falling global oil prices, is yet another eye-opener for Nigeria to re-examine its economic bearing. It is an opportunity to shift from a mono-economy and lay a foundation that promotes sustainable growth and development.

    One route that has consistently resonated at various fora is diversification, with agriculture as its pivot. Agriculture represents an opportunity sector, with huge economic potential and remains largely untapped.

    Nigeria earns over 80 per cent of her revenue from the petroleum industry, according to several reports, but the sector actually accounts for less than 14 per cent of the Gross Domestic Product (GDP), whereas agriculture commands about 22 per cent of GDP and generates two-thirds of employment nationwide.

    About 90 per cent of Nigeria’s food requirement is produced by small-scale farmers, who ironically, constitute the majority of the nation’s poor.

    A myriad of factors have been blamed for this miserly condition, both natural and man-made. Key is the lack of access to finance and the resultant inability to invest in basic farming inputs, such as seedlings, fertilisers, implements, irrigation as well as poor access to finance. These have led to low  yields and unmet economic expectations and aspirations.

    Expectedly, Nigeria’s vast natural resources and huge consumer market will drive strong growth and attract investments to other critical sectors of the economy, including energy, mining and solid minerals, infrastructure and tourism.

    Chief Executive, Stanbic IBTC Holdings Plc, Sola David-Borha said the event was to boost the economic diversification agenda of the current administration and create a win-win situation for all stakeholders.

    “The Stanbic IBTC Iron and Steel Business conference was conceived to tap into the economic diversification drive of government by bringing together stakeholders from both the public and private sectors to share deep insights into the opportunities in the solid minerals sector, which has the potential to rival the petroleum sector in revenue generation,” David-Borha, said, adding: “As a developmental partner, Stanbic IBTC will continue to take the lead in identifying opportunities that could be tapped into for growth through public private partnerships.”

    For the Minister for Solid Minerals Development, Dr Kayode Fayemi, solid minerals industry is the country’s next opportunity for development. This is backed by the Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP). At the recent executive business session organised by Stanbic IBTC, tagged: Iron and Steel in Nigeria…Prospects, Partnerships and Progression, he reiterated the Federal Government’s plan to drive industrialisation with industrial mineral endowment.

    With natural resource portfolio of at least 44 known mineral assets that include precious minerals, base metals, bulk minerals and rare earth minerals, Fayemi identified the country’s most promising mineral assets to include gold, iron ore, barite, bitumen, lead, zinc, tin and coal.

    “We believe the available data of our reserves understate what our country is endowed with. For one thing, some of the geosciences data collected 50 years ago or earlier, have not been updated. So, we are cautiously optimistic that our mineral endowments actually exceed what is currently stated,” he said.

    The solid minerals sector has been operating below capacity, with many mining operations manned by small scale artisanal miners, as opposed to the large scale actors. The Minister said Nigeria can generate at least N5 trillion annually from mining and exporting of its vast solid mineral deposits, with several multiplier effects on job creation, state  development and social infrastructure that could position the solid minerals sector as the main catalyst for national development.

    Also, solid minerals account for about nine per cent of South Africa’s GDP, while mineral revenues are projected to account for 34.4 per cent of Botswana’s total revenue in 2015/2016, and about 30 per cent of GDP, Fayemi noted.

    Head of Mining at Standard Bank, Anders Alfredson, listed import substitution opportunity, potential to develop  domestic iron   ore and other steel raw material resources, and abundance of attractively-priced energy sources available locally, among others as reasons to invest in the mining sector.

    Future demand growth, he said, has created opportunity to develop the domestic industry, with support from Standard Bank’s strong mining franchise, which would through Stanbic IBTC, partner local players to develop and deploy its global network to attract investment into the country.

    “Standard Bank, through Stanbic IBTC, is open to work with its existing in-country client base on potential opportunities to develop an integrated iron ore to steel player. Standard Bank would be able to leverage its global network to identify potential candidates for strategic investment into Nigeria,” Alfredson said.

    Besides, in Nigeria, the public sector has historically designed, funded, and executed development projects. But these projects, characterised by inefficiencies, have consistently failed to deliver optimum benefits, leading to severe drawbacks for business and the economy.

    The result is stagnant economic growth and grinding poverty among Nigerians. However, with the gradual diversification of the economy, which the private sector is expected to drive, opportunities would be created and if taken, would subsequently accelerate economic recovery and growth.

    With supportive regulatory framework, private sector participation is expected, in the same manner that it has transformed telecoms, petroleum products’ distribution, and financial services, among others, to help unlock Nigeria’s largely untapped solid minerals industry.

    It is in this regard that Nigerian banks, just as Stanbic IBTC Bank has indicated, should demonstrate their capacity to finance major development initiatives that have the potential to engender rapid economic transformation.

  • Nigeria and South Africa: Forging bonds of mutual prosperity in mining

    The recent state visit to Nigeria by President Jacob Zuma marked the beginning of a new chapter in relations between Nigeria and South Africa. Both countries have shared a sometimes turbulent history; we have also at different times revelled in the joy of aligned moral purpose – at some point towards the dismantling of apartheid, at some other point in the struggle to enthrone democracy.

    During the visit, both President Zuma and his host President Muhammadu Buhari made it a point of duty to strengthen the historical bonds of friendship between the peoples of Africa’s two largest economies. The rapprochement between both countries is one of the results of President Buhari’s economic diplomacy, which has focused on rebuilding Nigeria’s image and relationships in the comity of nations. This development can only result in positive outcomes for both economies, and also ensure alignment on the strategic future that we believe offers Africa its full potential.

    The visit also offered the opportunity for Nigeria and South Africa to renew the pledge of partnership on a number of key issues including mining. An existing 2013 MoU outlining areas of partnership in the fields of Geology, Mining, Mineral Processing and Metallurgy which had not been implemented was resuscitated. President Buhari thus mandated the Ministry of Solid Minerals Development to work with our South African counterparts to pursue the full implementation of the Agreement.

    Having identified South Africa as one of our strategic partners towards growing our mining sector, and on the back of improved diplomatic relations, I recently led a small delegation on a two-day working visit to South Africa, during which I met with my counterpart, the Minister of Mineral Resources, Hon. Mosebenzi Joseph Zwane, as well as the leadership of mining-related government entities, mining industry leaders and experts.

    Our delegation gained a lot of insights from the knowledge sharing sessions with the leadership of the Department of Mineral Resources, Council of Geosciences, MINTEK and other government entities, and the progressive discussions on opportunities of collaboration with some of South Africa’s finance institutions – especially the Industrial Development Corporation (IDC).

    Accordingly, the Ministry of Solid Minerals Development has outlined details of the implementation plan for the 2013 MoU on Mining which provides details of the priority areas Nigeria wishes to benefit from the South African mining industry’s competitive advantage. These include: Advanced Geological Surveys – detailed geo-sciences data generation; data interpretation analysis and application; assistance in the accreditation of the Geosciences Analytical Metallurgical Laboratories in Kaduna; exploration data reporting standards, e.t.c.; Mining Governance – the review of existing legal and legislative framework; improved mines inspectorate operations and technologies; upgrading and management of cadastral processes and operations e.t.c.; Mineral Processing and Development – processing of industrial Minerals; Beneficiation processes and technologies; value addition, quality assurance and standards in mineral development, e.t.c.

    Other areas include Metallurgy – improvement of metallurgical inspectorate operations and technologies; indigenous professional skill acquisition and technology transfer; metallurgical processes; steel making technologies e.t.c; Artisanal & Small Scale Mining Operation – production/supply of small and medium sized plants and machinery for small and mid-tier mining and processing e.g. the Igoli gold processing mill; development of industrial clusters in downstream mineral fabrication and manufacturing; Environmental Safety and Sustainability – enforcement of environmental safety and compliance regulations; review of  sustainability frameworks and regulations; remediation processes e.t.c.

    Nigeria is also looking to benefit from the wealth of Human Capital Resource in South Africa’s mining industry in areas such as – capacity building in global best practices along the value chain of the mining industry – occupational, health, safety and environment (OHSE), mines inspectorate and revenue collection, mineral production assessment, ASM management, steel and metallurgical inspectorate technology and regulation, etc.; as well as benefiting from technical assistance in the development of coal-to-power projects in Nigeria as part of our objectives to achieve a vibrant energy mix and realize our target of 10,000 mw of energy by 2019. The ministry also seeks to learn from the optimal organization of private sector players in the South African mining space.

    Conversely as South Africa’s putative oil industry gets off the ground, Nigeria should share the lessons that our experience affords us. Nigeria’s oil history, while it has a number of prominent missteps, still contains critical lessons which should be shared, together with our expertise in the Oil and Gas industry built over the years.

    For the new resource economy to benefit both local and global stakeholders, we are taking an activist posture towards issues of developing local content and ensuring a transfer of skills and technology that will be to our nation’s advantage in the medium and long term. While we are committed to maintaining a liberal business environment, we are also mindful that the new resource economy results in a win-win situation for all stakeholders.

    This is why we intend to see to it that host communities are directly and positively impacted by the activities that will be undertaken in their domains. The historic restiveness in the Niger Delta and labour related uprisings in the South African mining industry can be put permanently in the past with this new approach to governance of the extractives industries.

    Today, the continent’s fortunes appear partially stalled. Pundits wonder if our work of reform is entirely hostage to shrinking commodities demand from China and India. The decline the Naira and the Rand have suffered in the past year is partially linked to the commodities narrative. Nonetheless, the truth is that Africa’s narrative of prosperity has deeper roots, and is firmly in our control.

    Nigeria has our eyes set on a rebound in the global commodities market, hopefully sooner than later, and we are doing everything possible in the interim to ensure we position our industry for market dominance when that time comes.

    We will work towards stoking aggregate demand and restructuring entire swathes of our societies to prepare them for the next generation of jobs, and delivering a joined up locomotive of growth. Hopefully, other African countries will take a cue from the renewed commitment of our countries to partner towards building the capabilities to create jobs and broaden the economic opportunities available to young Nigerians and South Africans. The aggressive integration of our economies will also create new corridors of growth for our neighbours and partners in both the ECOWAS and SADC regions.

    We will find smart mechanisms for leveraging each other’s key strengths and easing the modalities for engagement between businesses in both countries e.g. visa liberalization for skilled mining and petroleum workers to help speed transitions as well as maintain growth momentum. We will also push our citizens to interact more intensively, whether it is in vacationing in each other’s countries or forming new personal networks. A shared experience and prosperity is the key to a new wave of African economic growth, and our Presidents are determined to deliver on that pledge.

    As we welcome South Africa’s delegates to Abuja on a follow-up technical visit this week, and as momentum gathers towards the Nigeria – South Africa Bi-National Commission holding in August this year, we will continue to explore means of creatively building bridges between our countries towards modelling the possibilities that African integration offers for shared growth and prosperity.

    • Dr. Fayemi is Minister of Solid Minerals Development.
  • Mining sector contributes N400b to GDP, says minister

    Mining sector contributes N400b to GDP, says minister

    Minister of Solid Minerals Development  Kayode Fayemi yesterday said mining and related services contribute only N400 billion to the Gross Domestic Product (GDP) and should be boosted with new investments.

    The minister, who spoke at the 2016 Stanbic IBTC Bank Iron Ore and Steel Business Session, held in Lagos, said mining should strive to match contributions of other key sectors like agribusiness at 22 per cent, and manufacturing 6.8 per cent, to the GDP.

    He said the ministry is working with banks to create low-cost funds for the mining sector, adding that banks are already working hard to establish mining desks.

    The minister described steel as the world’s most important engineering material crucial to any country’s industrialisation objectives, adding that Nigeria imports an estimated $3.3 billion of processed steel and associated derivatives, representing 80 per cent of the $4.2 billion total metal products imported per year.

    “The Federal Government of Nigeria is of the view that the steel industry can be attractive to investors due to the large untapped demand potential similar to cement in 1990s. The current market size of $3.3 billion per annum has potential to grow to $15.1 billion/annum with increased industriali-sation,” he said.

    He said that to fund the infrastructure needs of its growing economy over the next 30 years, Nigeria would need about $3 trillion. “This investment would allow Nigeria to close its current infrastructure gap and sustain an ideal infrastructure stock level of 70 per cent of GDP as it builds and maintains infrastructure assets across all its seven key sectors,” he said.

    Head of Mining at Standard Bank, South Africa, Anders Alfredson, said Nigeria market has potential to develop domestic iron ore and other steel raw material resources and as an emerging mining jurisdiction, opportunity to create stable legal framework.

    He said that Standard Bank, which is the parent company of Stanbic IBTC Bank, plays big in the mining industry, adding that there is relationship between steel production and GDP growth. “We have significant experience in funding infrastructure in Nigeria,” he said.

    Alfredson said Nigeria is not starting mining funding from the scratch, adding that Nigeria should develop a legal framework in place to get mining working.

    He said that Standard Bank provided $150 million to Kansanshi Mining Plc, and 80 per cent held subsidiary of Toronto listed First Quantum Minerals Limited as part of the $350 million five-year term loan.

    Kansanshi Mining owns and operates the Kansanshi mine, the largest copper mine in Africa and First Quantum Minerals Limited’s largest operation.

     

  • Mining: Fed Govt seeks Australia’s help to upgrade lab

    The Federal Government is seeking help from the Australian government to upgrade the mining laboratory in Kaduna to world class standard and realise the desire of the present administration to diversify the economy.

    Minister of Solid Minerals Development, Dr. Kayode Fayemi made the request during in Abuja when he met with the Australian High Commissioner to Nigeria, Mr Paul Lehmann who paid him a courtesy visit.

    A press statement endorsed by Sade Fatoke, on behalf of the Deputy Director (Press) Ambrose Momoh, Fayemi said rather than send raw minerals to Europe and South Africa, the quality of such minerals can be enhanced if certified in the country before export.

    While appreciating the role played by the High Commissioner’s predecessor in the promotion of Nigerian-Australian relations in the mining sector and the support of almost $1million in the area of research,  Fayemi confirmed that a number of ministry officials benefitted from exchange programmes, study tours as well as graduate programmes up to the doctorate level. He also acknowledged the support of the Geological Surveys, Artisanal and Small Mining Department and the Mining Cadastre Office.

  • Mining licences renewal fetches Fed Govt over N500m

    As the 30-day ultimatum given to owners of dormant mining licences to renew them elapses today, the Federal Government has made over N500million from the renewal of the licences.

    More than half of the owners of the dormant licences published for revocation have for the past few days been rushing to beat the deadline to avoid losing the licences.

    The Minister of Solid Minerals Development, Dr. Kayode Fayemi, had over a month ago warned that government was set to revoke over 1,500 mining licences and leases on account of dormancy.

    According to a source in the ministry, Nigeria has been losing a lot of money from the non operation of the licences and about 8,000 jobs have not being created as a result of it.

    The source said: “As the revocation deadline drew near, a lot of people have been rushing over to renew their licences.

    “Over N500million has  so far been raised so far from dormant licence owners coming to renew their licences which is good for the country. These dormant leases were just sitting there and not generating any revenue for the country.

    “The truth is that if these licences were active, it would have created about 8,000 jobs which were not there because the licences were dormant. But with the re-activation of these licences, jobs will be created in the industry.”

  • ISAC holds summit on mining and agriculture in London

    The International Strategic Alliance Committee (ISAC) has said it has concluded plans to host a Nigerian Mining and Agriculture summit in London in April.

    The event is scheduled to hold on the 4th and 5th of April at the Queen Elizabeth Conference Centre in Westminster, London.

    Speaking to newsmen in Lagos, Gilbert Agbeyegbe, who is in charge of ISAC Operations in Nigeria said “the summit is intended to bring together government officials from Nigeria and top Nigerian businessmen and women.”

    Expected at the event, he added, will be those who are interested in farming and mining in Nigeria.

    The summit, he said, will enable stakeholders to deliberate on issues and opportunities in the mining and agricultural sectors in Nigeria and make available on the spot opportunity to sign partnership agreements with international investors.

    Also highlighting details of the conference, Director of ISAC Events, Mr Olawale Adenugba noted that “ISAC is desirous of supporting the current administration in its bid to diversify the economy and develop the mining and agricultural sector.”

    Adenugba decried the dwindling revenue of the nation, urging those interested in farming and mining to seize this opportunity to attend the summit as an opportunity is here presented to develop these sectors.

  • Fayemi urges key mining countries to assist Nigeria

    Fayemi urges key mining countries to assist Nigeria

    Mr. Kayode Fayemi, the Minister of Solid Minerals Development, has called on key successful mining countries to assist Nigeria in its bid to diversify the economy through solid minerals.

    Fayemi made the call while receiving Mr. Perry Calderwood, the Canadian High Commissioner to Nigeria, on Tuesday in Abuja.

    According to him, the country seeks for the assistance of successful mining countries to achieve the mandate of President Muhammadu Buhari to diversify the economy from crude oil to solid minerals.

    Fayemi, who said that Canada had been able to grow its economy through mining sector over the years, expressed Nigeria’s willingness to emulate that country’s laid down structures and processes to move its economy forward.

    “We have to hit the ground running; we have no time to waste at all to achieve the mandate of the present administration.

    “We want to learn from successful countries, including Canada on their success stories in mining; we need their experience, assistance and others,’’ he said.

    Earlier, Calderwood said his visit was to discuss with the minister on areas that Canadian government could collaborate with the ministry.

    He said the two countries would continue to enhance the existing dynamic ties between them, adding that Canada had earned and achieved a lot through its mining sector.

    NAN reports that mining sector is the leading customer in Canada’s ports and it’s the highest paying industrial sector.

    It is also the largest employer of aboriginal people.

    In 2011, mining companies invested 17 billion dollars in capital investment and paid 7.1 billion dollars in corporate taxes and royalties.

  • Mining: no longer business as usual, says Fayemi

    Solid Mineral Development Kayode Fayemi has vowed to step on toes in the process of repositioning the sector. The government, he said, would demand compliance with regulatory framework by local and foreign investors and excellent work ethics.

    He said the sector would be better funded in order to achieve President Muhammadu Buhari’s vision of using it to diversify the economy and create jobs.

    Fayemi spoke in Kaduna during his working visits to the National Steel Raw Materials Exploration Agency (NSRMEA) and the Nigeria Geological Survey Agency (NGSA).

    Fayemi said: “The President’s mandate is clear- to make  solid minerals an alternative source of revenue and for employment generation. We must achieve these set goals. We will support you- the workers and all the agencies under the ministry, but we shall hold you accountable for every penny.

    “The President has sent us (the minister and the minister of state) to deliver on his mandate; we will do it without minding whose ox is gored.”

    Fayemi said the ministry would support artisans and those categorised as “illegal miners” and regulate their activities.

    He challenged  institutions and agencies under the ministry to be alive to their responsibilities of providing technical support to the sector.

    Fayemi said there was need for a review of  activities of the ministry through self-audit to determine whether they are still in tune with present reality.

    “The critical questions you must ask yourselves now is how do you fit into the agenda. Should it be business as usual or should we explore other creative ways of doing it”, the minister added.

    Fayemi, accompanied by the Mnister of State, Abubakar Bwari, and the Permanent Secretary, Mr Istifanus Fuktur, had earlier visited the National Metallurgical Development Centre and the Nigeria Institute of Mining and Geosciences, Jos to assess their facilities.