Kogi’s Senator Natasha’s Gold Bill reawakens the drive for need to prioritize exploration of Nigeria’s rich deposit of solid minerals across the country, writes Siaka MOMOH.
Erstwhile politically embattled Senator Natasha Akpoti-Uduaghan (PDP/Kogi Central)., is out with a bold and excellent one. Her Bill For An Act To Make Provisions For Nigeria Gold Reserve Industry Framework, And Other Related Matters, has passed second reading in Senate.
In her lead debate, Senator Natasha said the Nigerian Gold Reserve Bill represents a proactive step towards harnessing and maximizing the potential of Nigeria’s gold reserves by establishing a robust framework for the harnessing, exploitation, have been increasing reserves held in gold as a hedge against currency volatility and geopolitical risks.
“Gold reserves are critical for the economic stability of a country, acting as a reliable store of value, particularly during financial uncertainties. Before the fall of the Naira, that we are now experiencing the negative effects, one Naira was e equivalent to one Dollar or even greater at a time. This was because the value of the Naira was measured against Gold.
“By virtue of Section 2 of the Financial Agreement (Decimal Currency) Act (the Act that established the use of the Naira), “the parity of the Naira shall be equivalent to 1.24414 grams of fine gold”. A gram of gold is currently approximately $75.70, this was the strength of the Naira before its fall,” she said.
The Bill seeks to strengthen Nigeria’s position in the global gold market and ensure responsible and sustainable practices that benefit the country’s economy and communities.
The Bill also seeks to establish the Nigeria Gold Authority (NGA) that will be charged among other things, with the administration of Nigerian Mining Act with regards to the country’s gold resources thereby creating a robust gold reserve industry for the nation.
It also seeks to enhance the exploitation and sales of gold within Nigeria that will not only enhance the engagement and earning power of artisanal local miners but also ensure the maintenance of a strong Gold Reserve Ratio, as bulwark for strong and resilient economy that will create jobs in Nigeria through the gold industry.
The Bill presents a significant opportunity to drive economic growth and diversification by creating a conducive environment for investment in the gold sector, that can attract both domestic and foreign investors, stimulate job creation and boost revenue streams for the government.
In summary, one can make bold to say, the bill is a plus for the development of the solid mineral sector of the country, for the strong demand for the diversification of the Nigerian economy.
In this regard, the Lead Debate on the Solid Minerals Producing Areas Development Commission (EST ETC) 2021(SB 713) sponsored by Senator Yakubu Osuna , also from Kogi (Kogi Central) needs be cited here. The Bill sought to care for the accelerated development of the Nigerian economy and reduce over dependence on the dwindling oil revenues.
The solid minerals sector is said to be an alternative to petroleum for foreign exchange earnings. According to industry sources, globally, the mining industry has been a close rival to the petroleum industry while Nigeria only earns a paltry $89 million from it. And the commercial value of Nigeria’s solid minerals has been estimated to run in hundred billion of dollars.
The sad story of Nigeria’s solid minerals has been narrated on these pages before. We wouldn’t be tired of telling it. Why? To keep the governors of our economy on their toes; to keep reminding them of the importance of this sector to the uplifting of Nigeria’s failing economy; to let them know that the sincere development of this sector can be an important part of the solution.
The story told in part:
The Taraba examples
E.D. Oruonye/Y,M.Ahmed’s research article titled ‘Challenges and prospects of mining of solid mineral resources in Taraba State, Nigeria’ is a clear representation of the state of health of the solid mineral industry in Nigeria. These academics are of the Department of Geography, Taraba State University, Jalingo,Taraba State.
They stated in their abstract to the research: “Taraba state is one of the states in Nigeria that is well endowed with different kinds of solid mineral resources that is untouched and yet to be prospected. Some of these mineral resources have been explored and worked on in the past decades. Mining in Taraba state is dominated by artisanal and small-scale miners…The findings of the study show that large quantities of this mineral ore deposits have been mined out in the state resulting in large numbers of abandoned mine sites as a result of past mineral exploration /exploitation in the form of test pits, lotos and open ponds.
According to these dons, the Federal Ministry of Mines and Steel Development reported 192 titles issued out from Taraba state in 2012 and 77 in 2015. Some of the challenges, they said, include the fact that most of the mineral occurrences were just reported and that the real evaluation of the grade of mineral ore or the reserve estimates were never carried out.
They further stated that most of the mining operations were illegal and not known to government officials. For them, “This makes it difficult for the government to monitor their operations and also to enforce environmental regulations on them.” Other challenges, according to the abstract, include lack of mining equipment, predominance of artisanal and small-scale miners, poor technical capacity, lack of capital, poor database, poor infrastructures and accessibility among others.
Lastly, the academics said “The Federal government is working hard to simplify the process of acquiring mining licence by creating an online web portal to facilitate the application and payment process. It is expected that with improvement in the mining policy in the country, more companies and individuals would apply for mining licence in the state. Based on the findings of the study, the following recommendations were made; provision of capital by way of soft loan, tax holidays for mining firm and synergy between Federal Ministry of Mines and Steel and the State Bureau of Solid Mineral Resources.”
Why monoculture?
It is a sad story; a very sad one. The Nigerian economy is monoculture, one that is largely dependent on revenue earned from the oil sector. According to the International Monetary Fund (IMF), the sector accounts for over 95 percent of export earnings and about 40 percent of government revenues.
The tag ‘major exporter of oil’ placed on Nigeria, one that is making us giddy and which has given rise to corrupt government officials and business barons, amounts to nothing since Nigeria produces only about 2.7 percent of the world’s supply. Though ranked as 15th in production at 2.2 million barrels per day (mbpd), the top three producers Saudi Arabia, Russia, and the United States produce 10.7 mbpd (11.8 percent), 9.8 mbpd (12.0 percent), and 8.5 mbpd (11.1 percent) respectively, collectively accounting for 63.6 mbpd (44 percent) of the world’s total production. These are 2013 figures. Latest figures have not changed significantly. Currently, these three produce 12.0, 15.0 and 10.8 mbpd respectively (US is now leading producer) whilst Nigeria’s is 1.9 mbpd, down from 2.2 mbpd.
Non-Oil sector
This is the crust of the story here. The Non-oil sector is suffering neglect. In 2009 for instance, the sector was hit by setback as the total income generated from its export from January to September stood at US$900 million (N140.3 billion) while total amount that accrued to the country in 2008 was US$1.9 billion (N296.1 billion) amounting to a drop of 138 per cent in non-export earnings. In the same vein, according to Central Bank of Nigeria’s Q2 Economic Report, the total non-oil export earnings by Nigerian exporters in the second quarter of 2010 fell by 56.4 percent to US$297.2 million (N46.3 billion) from the level in the preceding quarter.
Neglected treasure
The non-oil product in question in our story here is solid minerals. The problem in the sector is of public knowledge. Small scale artisanal miners dominate solid mineral mining. They account for between 90 and 95 percent of the output of the Nigerian solid minerals sector. They are often unlicensed, illegal operators. In other words, they are informal operators. Independent research puts Nigeria’s informal economy at between 65 and 70 percent of GNP or GNI. Nigerian labour source says 90 percent of new jobs are accounted for by the informal sector and that the sector is responsible for 80 percent of all non-agriculture employment and 60 percent of urban jobs. The solid mineral sector belongs here.
Crude operation method
It is no news that it is tough capturing data of activities in the informal sector. What this means is loss of vital revenue to government. When the number of miners is not known, it is difficult to plan the sector, it is difficult to organize the sector, it is difficult to successfully introduce modern mining technology into the sector that will make miners operate in a safe environment. It was the crude method of operation, unregulated bunch of mining operatives, that was responsible for the calamity experienced and perhaps still being experienced in Zamfara State to date. The case in point is the death of about 200 people in Zamfara from lead poisoning, arising from unregulated artisanal mining. Recall the academics’ findings cited earlier, the corroboration is clear.
Lead poisonings
According to reports, lead poisonings in Zamfara State, led to the deaths of at least 163 people between March and June 2010,including 111 children. Health ministry figures state the discovery of 355 cases,with 46 percent proving fatal. An annual immunization programme in northern part of Nigeria led to the discovery of a high number of child deaths in the area. An investigationshowed that they had been digging for gold at the times of their deaths, in an area where lead is prevalent. It was thought by the villagers that all the children had contracted malaria but Médecins Sans Frontières found unusually high levels of lead in the blood during tests.The BBC suggested the contamination of water may have contributed to the high mortality rate. Blacksmith Institute was called in by the Nigerian authorities to assist in the removal of toxic lead.
It is believed that the poisonings are caused by the illegal extraction of ore by villagers, who take crushed rock home with them to extract…
Two treatment camps were established by health authorities to deal with the crisis. The World Health Organization, Médecins Sans Frontières and Blacksmith Institute assisted with the epidemic.
Need for support
One thing is clear here, artisanal miners need support, organization and regulation, not just cash hand-outs from the ministry. They must be empowered and incorporated into the value chain of mineral production and marketing. The World Bank granted a credit of $120 million for the sustainable development of our mining sector. What has happened to the fund? Nobody knows. Government responsibility must not stop at licensing private sector participants but must also include provision of more accurate geological information about our mineral resources.
There have been reports in the media of unwholesome activities by the Chinese engaged in solid minerals mining in Nigeria. One will want to believe that the Ministry of Solid Minerals is listening and addressing the issue.
