Nigeria Government Takes Action Against Dormant Mining Licenses
The Federal Government of Nigeria has taken a decisive step by revoking a total of 924 dormant mining licenses in a bid to cleanse the mining sector. The announcement was made by the Minister of Solid Minerals Development, Dr. Dele Alake, during a press briefing in Abuja. Dr. Alake expressed deep concern over the corruption and irregularities in the issuance of mining licenses.
The revoked licenses included 528 for exploration, 22 mining leases, 101 quarry licenses, and 273 small-scale mining licenses. The Minister stressed that the racketeering of mining licenses has hindered the growth and development of the sector, and has prevented genuine investors from participating in Nigeria’s mining industry.
In an effort to allow defaulters to address their situation, the government provided a 30-day grace period for them to state reasons for the dormancy of the allocated sites and to resolve any outstanding issues, as stipulated by Constitutional provisions. However, out of the 963 licenses published for revocation, only 39 license holders responded by either moving to their sites immediately or providing reasons for the challenges hindering their operations.
The Minister emphasized that the revocation of these licenses aims to cleanse and reposition the mining sector, thereby enhancing Nigeria’s economic potential and expediting its industrialization process. He also highlighted the need to address the “first-come, first-served’’ rule in the licensing regime, which has deterred genuine investors due to the prohibition of issuing fresh licenses on already allocated sites.
This recent action follows the revocation of 1,663 mining licenses in November 2023 due to licensees’ failure to pay statutory charges and other dues to the Federal Government. Despite significant pressure on the government to reconsider the revocation, a policy was eventually issued, allowing defaulters to make restitution and show remorse in order to be considered for reinstatement, with varying amounts of restitution dependent on the category of the revoked license.
Looking ahead, the Minister cautioned that more mining licenses would be revoked for other categories of defaulters and issued a stern warning against the nefarious activities of individuals who bought licenses for promising mine sites, only to resell them on the illegal market. He stressed that this practice not only tarnishes Nigeria’s image but also diverts funds from exploration to the illegal market, resulting in exorbitant prices for acquiring licenses.
The Minister’s resolute stance underscores the government’s commitment to cracking down on illegitimate activities in the mining sector and retaining Foreign Direct Investment lost due to such practices. As Nigeria continues to strive for economic growth and sustainable development, it is essential to create a fair and transparent mining environment that encourages genuine investors to contribute to the nation’s mining sector.
