A recent report by KPMG, a prominent global audit, tax, and business advisory firm, has brought to light the fact that as of May 2024, a total of 7,182 entities, including companies and individuals, have obtained licenses to engage in various activities within Nigeria’s mining sector. These activities encompass exploration, mining lease, quarrying lease, and small-scale mining license.
The report has underscored the myriad challenges confronting the sector, including the dearth of critical infrastructure, restricted access to geoscience data, and insecurity in regions abundant in minerals. Moreover, KPMG has stressed that Nigeria, owing to its substantial mineral wealth, should be a favoured destination for multinational mining companies.
A major concern raised by KPMG is the absence of dependable geological information pertaining to available mineral resources, which poses a barrier to attracting potential investors. However, the report has acknowledged the advent of the Nigerian Mineral Resources Decision Support System (NMRDSS) as a positive step towards overcoming this obstacle.
Additionally, the report has brought attention to the adverse impact of insecurity on the growth of Nigeria’s minerals sector, particularly in the northern and Middle Belt regions, and has advocated for security measures to curb illicit mining activities and ensure a safer operational environment.
The firm has also identified project funding as a significant hurdle, attributing it to factors such as the insufficient number of bankable projects, policy uncertainty, and global economic dynamics. Consequently, it has called for the implementation of a more appealing fiscal framework and incentives for miners to spur investment in the sector.
Furthermore, KPMG has recommended that Nigeria should join relevant international mining organisations to attract Foreign Direct Investment (FDI) and leverage relationships with globally renowned mining bodies. The report has highlighted Nigeria’s rich array of mineral deposits, including gold, barite, limestone, coal, and lead/zinc, whilst urging the government to address domestic challenges and enhance the ease of conducting business within the country.
In summation, the report produced by KPMG has shed light on the challenges and possibilities within Nigeria’s mining sector, thereby furnishing invaluable insights for pertinent stakeholders and policymakers. As the nation endeavours to harness its mineral wealth for economic progress, addressing these issues will be decisive in ensuring the growth and endurance of the sector.