Nigeria to Grant Mining Licenses to Companies with Local Processing Plans.
In a significant policy shift, Nigeria is poised to grant new mining licenses exclusively to companies committed to local mineral processing, departing from its traditional practice of exporting raw materials without processing. The move aims to maximize the value derived from Nigeria’s abundant solid mineral deposits, according to a government spokesperson.
Despite Nigeria’s status as Africa’s leading energy producer, the country has historically derived minimal value from its vast mineral resources. The mining sector’s contribution to the nation’s gross domestic product has remained below 1%, largely due to insufficient incentives and neglect.
To attract more investment into the mining industry, the government is taking several proactive measures, including issuing additional licenses and establishing a state-owned solid minerals corporation, where investors can secure a 75% stake. Additionally, a special security unit has been formed to counter illegal mining activities.
Efforts are also underway to regulate the artisanal miners who currently dominate the sector by organizing them into cooperatives. Furthermore, the government plans to offer tax waivers on mining equipment imports to incentivize more investments in the country’s mining sector. It also aims to streamline the process for securing electricity generation licenses and facilitate the full repatriation of profits for investors.
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Segun Tomori, a spokesperson for Nigeria’s Minister of Solid Minerals Development, highlighted that companies seeking mining licenses will be required to present plans for setting up processing plants and adding value to the Nigerian economy. However, specific guidelines regarding these requirements and their implementation timeline have not been disclosed.
Last September, Reuters reported on Nigeria’s plans to establish a state-backed minerals corporation, named the Nigerian Solid Minerals Corporation, primarily engaged in the extraction of gold, coal, iron ore, bitumen, lead, limestone, and baryte. These initiatives underscore Nigeria’s commitment to unlocking the full potential of its mineral wealth and driving economic growth through sustainable mining practices.
