82 Mining Companies Fail to Make Mandatory Social Payments to Host Communities, NEITI Report Reveals
In a recent industry report for the Solid Minerals Industry, the Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed that an alarming 82 mining companies have failed to fulfill mandatory social payments to their host communities. This lack of compliance has been found to be a violation of the community development agreement.
Out of the 121 companies examined in the report, only 39 were deemed to have fulfilled the required social payments in line with the community development agreement. Additionally, it was identified that 10 companies had only made non-mandatory social payments or expenditures, underscoring the widespread lack of adherence to the social benefit requirements outlined in the NMMA 2007 and NMMR 2011.
In addition to the issues surrounding social payments, the report also uncovered a troubling lack of adherence to environmental standards among the mining companies. Surprisingly, only 41.32% of the companies were found to have fully complied with environmental regulations, indicating a high level of non-compliance with existing environmental laws.
NEITI’s report has urged the Ministry of Solid Minerals and Mining Cadastre Office to take urgent action in developing a comprehensive framework for monitoring compliance with the terms of the Mineral and Mining Act 2007 and the Minerals and Mining Regulations, 2011. Furthermore, the report recommended the implementation of penalties for non-compliance and the consistent enforcement of such penalties to ensure accountability within the industry.
Former Minister of Mines and Steel Development, Olamilekan Adegbite, has emphasized the importance of mining companies upholding the terms outlined in the Community Development Agreement. He stressed the seriousness with which the Federal Government views the relationship between mining companies and their host communities, urging companies to take their responsibilities seriously.
A key aspect of the Community Development Agreement, as explained by Adegbite, is the agreement made with the host community to undertake a set of projects over a period of five years. He called upon mining companies to be more responsive to the needs of their host communities in order to foster peaceful coexistence, underscoring the importance of community prosperity as the companies themselves prosper.
In light of the NEITI report’s findings, it is evident that there is an urgent need for increased adherence to social payment requirements and environmental standards within the mining industry. The enforcement of penalties for non-compliance, as recommended by NEITI, will be essential in ensuring that mining companies uphold their responsibilities to their host communities and operate in accordance with established regulations. The development and implementation of a robust compliance monitoring framework will also play a crucial role in promoting transparency and accountability within the industry.
