The Federal Government of Nigeria has undertaken a significant initiative to revoke 924 dormant mining licences in an effort to address the issue of racketeering within the sector. Dr Dele Alake, the Minister of Solid Minerals Development, has expressed deep concern regarding the illicit issuance of licences and its adverse effects on the country’s mining industry.
The licences that have been revoked consist of 528 for exploration, 22 mining leases, 101 quarry licences, and 273 small-scale mining licences. The Minister has underscored the fact that a 30-day grace period was granted to defaulters to rectify their status and present justifications for the dormancy of their allocated sites.
With the aim of streamlining and rejuvenating the mining sector for the benefit of Nigeria’s economy, the government is taking resolute action to clamp down on individuals who engage in fraudulent practices to procure mining licences.
Subsequent to the publication of 963 licences in the official gazette of the Federal Government, only 39 license holders responded to the warning by either promptly relocating to their allocated sites or elucidating the obstacles impeding their operations.
Dr Alake has underscored that the revocation of the licences is intended to cleanse the sector and establish a conducive environment for genuine investors. He has observed that the current “first-come, first-served” rule is dissuading legitimate investors from participating, as it prohibits the issuance of fresh licences for already allocated sites.
This latest action follows the revocation of 1,663 mining licences in 2023 due to the failure of licensees to fulfil their statutory obligations to the Federal Government. In response to the subsequent pressure, the government introduced a policy for defaulters to make restitution and demonstrate remorse to be considered for reinstatement.
According to Dr Alake, the restitution amount varies depending on the category of the revoked licence. For mining licences, a restitution of £10 million per licence is required, while small-scale licences and exploration licences require £7.5 million and £5 million, respectively.
In his 2024 New Year goodwill message, the Minister cautioned that more mining licences would be revoked for other categories of defaulters. He also warned against the nefarious activities of individuals who acquire licences for high-potential mine sites only to resell them on the illegal market, which tarnishes Nigeria’s image and diverts investment funds to unlawful activities.
Dr Alake has stressed that Nigeria is losing a significant amount of Foreign Direct Investment due to these illicit practices and has emphasized the government’s commitment to creating a transparent and equitable mining sector for the benefit of the country.
The decisive action taken by the government reflects its determination to address the systemic challenges within the mining industry and restore confidence among genuine investors. It is a step towards promoting sustainable economic growth and industrial development in Nigeria.