FeaturesFEATURES: From Crude Oil To Solid Minerals

FEATURES: From Crude Oil To Solid Minerals

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September 10, (THEWILL) – Anytime from 2070, Nigeria’s crude and condensate reserves of approximately 37 billion barrels would have been completely exhausted. By then, crude oil would have ceased to be the major external revenue generator for the country. Apart from its immense human resource capital, Nigeria may have to find some other ways of generating external revenue.

According to statistics provided by Nigeria Upstream Petroleum Regulatory Commission (NUPRC), the estimation made on January I 2023 represents 31.060 billion barrels of oil and 5.906 billion barrels of condensate. It will last for 49 years from now.

Adult Nigerians above 50 now may not be alive to witness what the economic outlook will be 50 years hence. But there is a pointer to what may likely happen: Solid minerals!

And President Bola Ahmed Tinubu’s administration is looking towards making it possible – that is looking beyond crude oil as the country’s major external income. How is this so?

On inauguration on May 29, President Bola Tinubu made some crucial appointments: Dele Alake as Special Adviser Special Duties, Communications and Strategy while Nuhu Ribadu was made Special Adviser Security. Others were Yau Darazo Special Adviser, Political and Intergovernmental Affairs, Wale Edun Special Adviser Monetary Policies and Olu Verheijen Special Adviser Energy. Also, Zacchaeus Adedeji was appointed Special Adviser Revenue, John Ugochukwu Uwajumogu, Special Adviser, Industry, Trade and Investment and Salma Ibrahim Anas as Special Adviser on Health.

Between their appointment and submission of nominees to the Senate months later by Tinubu, speculation was rife that some of tthem would naturally morph into higher ministerial positions, down to the possible portfolios that will be assigned to them. Some of the analysts got it right and most of them were wide off the mark.

One that stumped pundits most was Alake’s appointment as Minister of Solid Minerals by his principal of more than two decades. Alake was Commissioner of Information and Strategy for all the eight years Tinubu was governor of Lagos state from 1999. Both of them have remained together over the years through a carefully calibrated companionship reminiscent of Jeeves and Wooster in PG Wodehouse’s short stories with Alake playing the role of an intelligent interpreter of his master’s every wish.

It was no surprise therefore that Alake headed the Tinubu campaign team before and during the February 25 presidential poll. If ever there is a Tinubu person, Alake is that man. Unsurprisingly also, he was one of the few persons appointed early in Tinubu’s administration. So, when the Senate cleared Alake during the ministerial screening, most pundits naturally expected him to be deployed to the Ministry of Information and Strategy. Wrong!

Alake’s appointment as Minister of Solid Minerals, the pundits now saw almost belatedly, was not only deliberate but also a pointer to what Tinubu’s government hopes to achieve with the otherwise neglected ministry evoking images of scrawny miners with pans, diggers and shovels in excavated muddy terrains in Ogun, Kogi or Zamfara states.

In reality, solid minerals are as profitable as its crude cousins found in the bowels of the earth. The problem is that successive governments in Nigeria have accorded crude exploration more recognition than prospecting for gold or barite. And such is the importance of crude that two former presidents of Nigeria – Olusegun Obasanjo and Muhammadu Buhari – kept the Ministry of Petroleum under the folds of their brocaded Agbada as if it was a personal property. By contrast, did any of them function as Minister of Solid Minerals throughout their eight-year-tenure?

President Tinubu, on the other hand, is now towing a different path with the appointment of his main man to head the Ministry of Solid Minerals and Alake seems to relish his new job with all the eagerness and enthusiasm of a Jeeves competent enough to get the job done. And he more than proved it early this month in Abuja during the unveiling of “Agenda for the Transformation of the Solid Minerals for International Competitiveness and Domestic Prosperity.”

Mining, the minister declared, “is big business and Nigeria must assert its presence in this environment by replicating its strategic positioning in the petroleum sector by setting up a corporate body that plays in this field. Consequently, the Ministry shall work towards the incorporation of the Nigerian Solid Minerals Corporation.”

The corporation will be “a state-backed company to manage its minerals and provide funding in the mining sector.” As of now, the country is rich in gold, coal, limestone, bitumen, lead, iron ore and barite which “requires immediate intervention” by the ministry.

In his words, “the proposed corporation will seek and secure partnership investment agreements with big multinational companies worldwide to leverage on the attractive investment-friendly regime operating in the country to secure massive Foreign Direct Investment for the mining sector. The positioning of the national corporation as a guarantor and protector of the partnership agreements is expected to assure partners of our seriousness and fidelity.”

What’s more, the minister gave “all miners engaged in the illegal extraction of mineral resources in the country an ultimatum of 30 days to join notable mining cooperatives or face the full wrath of the law.” To that end, policemen and other relevant agencies will be among a task force of surveillance teams to monitor the mining activities in Nigeria.

On illegal mining and the 30-day ultimatum, Alake said he couldn’t understand how “a country with precious minerals like gold, bitumen, lithium, and uranium in massive proportions could fail to use the resources to liberate its citizens,” insisting that “I am giving illegal miners in this country just 30 days grace to join cooperatives or find another vocation. Also, the proposed task force will be domiciled in the ministry and will comprise operatives of all the relevant security agencies.

“For the last time, let me declare again that the ministry is giving such persons 30 days grace to join a miners’ co-operative or find another vocation to do. On the expiration of the period, the full weight of the law will fall on anyone seen on a mining site without a determinable status. This message will be interpreted into Nigerian languages and broadcast on the radio to ensure no one is ignorant of this directive.

“From October, a rejuvenated security regime will become active in the solid minerals sector. This will include the Mine Police, sourced from the Nigeria Police and specially trained to detect illegal mining and apprehend offenders. The new Mines Surveillance Security Task Force will coordinate the Mines Police and proactively address high-risk incidences of breach of Mining Laws. The Federal and State governments will also be encouraged to allocate the prosecution of cases against illegal miners to competent courts.”

Others share Alake’s fear of the disruptive actions of illegal mining in Nigeria. Mary Ogbe Permanent Secretary of Ministry of Mines and Steel Development lamented early last month that the activities of “illegal mining was disrupting the country’s N700 billion industry,” reason being that some of the minerals are “exported raw to Asian and European countries at ridiculous prices without value.”

A breakdown of solid minerals deposit and extraction in Nigeria shows Ogun state in top position. One report published in August 2022 quotes the National Bureau of Statistics which shows that Nigeria produced 89,482,541.07 tons of solid mineral resources in 2021, stating further that “production figures increased by 39.19 percent or 25.2 million from 64.28 million tons in 2020.”

More important is NBS’s admission that ”the mining and quarrying sector is a vital sector that should be tapped into for economic growth in Nigeria. The aggregate production of mineral products in Nigeria in 2021 grew by 39.19% from 64.29 million tons recorded in 2020 to 89.48 million tons in 2021, indicating an improvement in production.“

Still in the same report, a state-by-state analysis showed that Ogun state recorded the highest production in 2021 with 32.04 million tons, followed by Kogi with 18.40 million tons and Cross River with 11.64 million tons. The least production was in Bornu state with a mere 231 tons.

But with the renewed hope and commitment of the Tinubu Administration to tap into the vast potentials of solid minerals and with the appointment of his point man as the number one man overseeing the ministry, this might just be the beginning of a new dawn in an area of Nigeria’s economy that has been, at best, forgotten or not as cuddled as the petroleum sector.

In January, Olamilekan Adegbite, Minister of Mines and Steel Development at the time, said that neglecting the solid minerals sector was not doing Nigeria any good. Production data so far, he went on, “was far below output figures due to unaccounted artisanal and small-scale mining activities.” Nigeria, Olamilekan said back in January, “has the minerals of the future that can power electric cars and phones.”

Experts and analysts have shared Olamilekan’s views about looking beyond crude oil. One of them, Toun Ogunbiyi made a case for diversifying Nigeria’s economy in an opinion piece published in Businessday of December 2021. Headlined “Why Nigeria needs to diversify economy through solid minerals development,” Ogunbiyi stated thusly: “The lack of diversification of the economy over the years has put the nation’s economy in a perilous state and has consequently left it at the mercy of international oil prices.

“The need to effectively and efficiently exploit solid mineral resources as a means of generating huge revenue for Nigeria cannot be overemphasized as the oil and gas sector which Nigeria has so much depended upon since its discovery in the 19th century has been faced with so many hiccups over time, ranging from the deliberate sabotage of the crucial sector through vandalism by militants, to the inconsistent prices of crude oil in the international market coupled with the discovery of alternative sources of generating power and energy thereby further reducing the demand for crude oil.”

Continuing, Ogunbiyi observed that “the solid minerals sector contributes 0.6 percent to the GDP of Nigeria while the government plans to increase it to only 5 percent in 2025. Meanwhile, over 90 percent of the activities of the mining industry are dominated by artisanal operators, thereby accounting for the low output level in the industry. From 1992 till date, there has been a continuous decline in solid minerals contributions to the industrial sector as its value has kept on fluctuating between 0.3 percent and 0.4 percent.”

Now, there is hope all that will change. Alake, who is fully in charge of Solid Minerals, feels exactly the same way about the untapped potentials of the ministry under his care. So, when Nigeria exhausts its crude and gas in the oil-rich Niger Delta and elsewhere 50 years from now, at least generations coming after will have something to look up to – gold from a remote forest in Ogun, barite and ore from the craggy plains of Okene or Itakpe, gypsum from Okpella or lithium from Zamfara – to bring in the money.

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