Mining Investment in Nigeria: Its Benefits and Challenges
Nigeria is a land of opportunity; a large population, hidden treasures
and access to the ocean (This makes it easier for her to benefit from
international trades with countries in every corner of the world).
Nigeria is also blessed with abundant mineral resources which are mostly
available in commercial quantities. There are proven reserves of iron
ore, gold, zinc, limestone, barite, tin, and bitumen across the country.
Among other reserves, reports show that Nigeria has deposits that are
over 42billion tonnes of bitumen, 3billion tonnes of iron ore, 3billion
tonnes of coal, 1billion tonnes of gypsum, 40million tonnes of
talc,10million tonnes of lead and zinc, and 1.5million tonnes of rock
salt.
Of these reserves, it is estimated that less than 5% are currently being
mined, refined and marketed.
Currently, the Nigerian mining sector contributes 0.33% to the
country’s GDP. Considering the large volume of mineral deposits we
have, this is way below our true potential as a nation. The Nigerian
mining sector is still characterized by crude mining techniques. This
partly explains why we still import materials like iron and salt.
The government’s continued interest in income diversification has
forced her to make investments in the mineral sector more attractive.
They’ve been series of amendments to the Mining Act and geological
data have also been made more available for public consumption.
With these developments, Nigeria holds a promise of a significant
increase in investment from small and large multinationals and an
increase in local and international market demand which will
significantly boost the mining sector’s contribution to a broader
economy in the coming years.
ECONOMIC BENEFITS OF MINING
The economic significance of the mining industry has been
underestimated, but research has shown that the mining industry plays an
important role in boosting the economy and growth of a country.
* Providing livelihood to local communities:
With the exploration of the mining industry and the influx of investors,
there will be an increase in job opportunities for the immediate
community as well as the general public.
* Generating income for the government and contributing to its GDP
growth:
The exportation of mined minerals will bring about a significant
increase in revenue generation for the government. This will boost the
GDP of the country and increase the affordability of minerals for local
consumption.
* Promoting more efficient use of energy and creating environmental
awareness.
* Better lives for the citizens:
The government can utilize the revenue generated to provide more
infrastructural facilities for the people.
* Increased grassroots development.
* Reduction in the cost of living.
* The increased fusion of technology into society
* Massive employment and a significant reduction in the crime rate.
* Increased infrastructural facilities
CHALLENGES
Challenges surrounding the mining industry in Nigeria include:
* Limited geoscience data and information: Most of the available
geological data in Nigeria are not up to date. This affects the
credibility of the information and it has also affected the realization
of mining projects.
* Infrastructure development: the infrastructural imbalance within
Nigeria is a major challenge to the development of the sector,
particularly inadequate electricity supply and access roads to sites of
mineral deposits.
* Security: Many ethnic, communal and religious conflicts occur
intermittently in the country and these affect mining in some
communities.
* Project funding: Due to the long period of dormancy and the slow
implementation of the Federal Government’s reform agenda in the
sector, multinational corporations have been reluctant to fund major
mining projects in the country.
* Lack of robust fiscal framework: The existing fiscal framework in
the mining sector is not investor-friendly and does not consider the
strange nature of the sector, particularly, its long development period.
We expect that in the next five to ten years, the Nigerian mining sector
would further develop with the entrants of new companies, a catapult in
revenue growth rate in the industry, a decrease in illegal mining
activities and increased participation of the host communities in
promoting a harmonious relationship with the mining companies.
A lot of steps have been taken to reform the sector for more investment
especially as a lot is expected to be earned from solid minerals. With
high expectations and willingness amongst key stakeholders to
collaborate in gearing this growth, there is no better time to invest in
the mining paradise of Nigeria than now.
As you might have observed, mining is not an investment that doesn’t
have its challenges. As daunting as the challenges might seem, they can
be carefully managed with the right guidance. At Wasia Africa Mining Co,
we know our way around the mining community. We have been involved in
mining activities across the federation and every single exploration
activity we have started has been yielding positive results. To learn
more about how you can benefit from the avalanche of investment
opportunities available in the Nigerian mining sector, contact us now.
If you have any further questions, you can call +2349071025723 or email:
info@wamco.ltd
Visit website: https://leadwebpraxis.com/
