Unlocking Nigeria’s Mining Potential: A Path to Economic Growth

Title: The Significance of Nigeria’s Mining Sector in Revenue Generation and Development

In Nigeria, the mining sector presents significant challenges that require attention. Osam Iyahen, Senior Director of Africa Finance Corporation, provides insight into the importance of mining in Africa, the impact of illegal mining, the role of data, and the future prospects for Nigeria’s mining industry. With an estimated $700 billion in commercially viable minerals, Nigeria has the potential to diversify its revenue sources and enhance foreign exchange earnings.

Iyahen emphasizes the crucial role of mining in Africa, given the continent’s abundant resources and the extensive benefits it offers in terms of GDP growth, employment, and export revenue. Nearly half of Sub-Saharan Africa’s export value historically originates from natural resources, highlighting the sector’s significance in driving economic progress.

Examining AFC’s commitment to mining, Iyahen notes the substantial investments amounting to $900 million. These investments cover various minerals, including gold, copper, cobalt, manganese, diamonds, and bauxite. The Segilola Mine in Osun State serves as a notable achievement, demonstrating the commercial viability of mining in Nigeria.

However, Iyahen acknowledges the challenges hindering the sector’s growth, particularly the lack of global familiarity with Nigeria as a mining jurisdiction. He emphasizes the need for strategic financing to support mining projects and make them more attractive to international investors.

Illegal mining presents a significant obstacle to the sector’s progress, prompting Iyahen to urge the government to proactively address this issue. He recommends formalization and responsible mining practices, as well as enhanced law enforcement presence and coordination in mining areas. Additionally, creating awareness about the negative impacts of illegal mining and leveraging advanced surveillance technologies are crucial steps in curbing illegal activities.

Iyahen commends Thor Exploration for its distinctive approach to Nigeria’s mining sector, highlighting the company’s strategic asset identification, competent team composition, and strong emphasis on Environmental, Social, and Governance (ESG) principles as factors contributing to its success.

In replicating such success stories, Iyahen underscores the importance of commitment to key principles, including asset identification, competent team composition, adherence to ESG standards, and openness to diverse financing options. He expresses optimism about other companies adopting similar approaches in the near future.

When discussing early-stage funding for mining projects, Iyahen emphasizes the need for thorough exploration and certification of assets to attract funding. He elaborates on AFC’s collaboration with the Solid Minerals Development Fund, outlining initiatives to facilitate early-stage project development and mitigate risks for project sponsors.

Addressing the challenges of dealing with host communities, Iyahen emphasizes collaborative engagement and community inclusion. He highlights the importance of Corporate Social Responsibility (CSR) programs in providing essential amenities to host communities and creating employment opportunities.

In conclusion, Iyahen underscores the importance of fostering mutual trust and alignment of interests between project sponsors and local communities. By prioritizing community inclusion and sustainability, mining projects can achieve long-term success and contribute positively to both economic and social development.