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THE PRESENT STATE OF MINING INDUSTRY

The Nigerian economy, which has a Gross Domestic Product (GDP) of about $400 billion (US dollars) in 2018, is the biggest in Africa and the thirty-first in the world. There are five main industries: Agriculture, petroleum-related industries (oil and gas), mining (soid minerals), manufacturing, and services round out the list.

Nigeria is a heavily populated rising economy with a manufacturing and services sector that is expanding quickly.

Unfortunately, the economy still relies heavily on the oil and gas industry, which accounts for over 90% of export earnings, 75% of gross revenues, and around 40% of the nominal GDP.

Nigeria's solid minerals and mining sector contributed a pitiful 0.3% of the country's GDP in 2015; this percentage improved marginally to 0.5% in 2018. Less than 0.02% of Nigeria's total exports came from this sector. The success of the industry can be compared to the GDP contributions of the following other African nations: Botswana (38%), the Democratic Republic of the Congo (25%), South Africa (18%), Zambia (18%), Guinea (12%), and Ghana (7%). Due to the introduction of new policies, the solid mineral sector in Nigeria has made some development recently, but the improvement is still negligible. According to studies, the sector's contribution to the GDP doubled between 2010 and 2015, rising from $143 million to $290 million, and to over $2 billion in 2018. Instead of higher mineral output per se, the increase in income can be attributed to more effective revenue collection methods and more foreign investment through the acquisition of mineral rights.

The economy of Nigeria has a significant problem as a result of the relatively low output of Niger's surface minerals, especially given how much potential there is for economic diversification in this important sector. The situation as it is now was not always the case. Mining contributed up to 50% of the GDP until the 1960s, making it a major economic pillar. However, this substantial contribution abruptly decreased starting in the 1960s as a result of the finding of oil and gas, which distracted both the government and investors' attention from the mining of commercial minerals.

Additionally, the 1960s civil war and the ensuing political unrest and territorial unrest caused a large evacuation of international mining corporations and their specialists as well as the migration of some indigenous miners, which ultimately resulted in the termination of mining activities.

Solid minerals' economic impact had fallen to less than 5% by the 1970s, to less than 1% in the 1990s, and finally to 0.5% by 2007. In an effort to diversify Nigeria's economy, efforts are being made to overhaul and reenergize the country's minerals and mining sector, which is currently thought to be underperforming. Instead of being transformative, the anticipated shift will be transitory.

In 2015, the Federal Government, through the Ministry of Mines and Steel Development identified ‘Seven Strategic Minerals’ namely; coal, bitumen, limestone, iron ore, barites, gold and lead and zinc – for priority development in a bid to revive the mining sector, unlock its potential and diversify the economy away from crude oil.

These minerals are deposited across the country and have not been fully explored due to a myriad of factors.

The seven strategic minerals:

LIMESTONE

Limestone is an industrial mineral required to produce cement. Nigeria has large deposits of limestone in Gombe, Benue, Kogi, Sokoto Edo, Oyo, Ebonyi, Ogun and Cross River States.

The annual national demand for limestone is estimated to be around 27 Mt with companies like Dangote, BUA and Lafarge dominating the cement industry.

The operations of these companies alongside conducive policies have been beneficial in strengthening the value chain and increasing local production. Today Nigeria has moved from being net-importer of cement to a net-exporter, saving around $10 billion in foreign exchange in the past decade.

COAL

Coal is also called metallurgical coal, is used in the form of coke and serves as fuel in the conventional steel processing as it provides the heat energy needed to melt down the raw materials. It also acts as a reducing agent in the blast furnace.

Nigerian coals are generally non-coking hence; most of the cokes derived therefore are not directly utilisable in blast furnaces. Nigeria has a proven reserve of 639 million metric tonnes of coal.

There are several opportunities that this mineral proffers, particularly with the coal to power project which aims to create more sustainable energy sources for Nigerians.

GOLD

Gold is one of the most valuable resources in Nigeria. It also accounts for an extensive amount of artisanal mining activities. Large deposits of gold have been found in the north-west and south-west of Nigeria and other parts of the country, mainly as a result of exploratory activities and activities of artisanal miners.

Thor Explorations’ Segilola gold project in Osun state is expected to be a game changer in the industry as the facility aims to mine and produce gold ore.

More recently, the Nigerian government has licensed gold refineries to produce the metal for export and for the Central Bank of Nigeria to become an off-taker, buying at international prices.The Presidential Artisanal Gold Mining Initiative was recently flagged off by the Federal Government, working with the Solid Mineral Development Fund.

IRON ORE

Iron ore is one of the critical minerals used to produce steel. There are over 3 Bt of iron ore found in Kogi, Enugu, Niger, Zamfara, and Kaduna States. Earlier in May, the Federal Government inaugurated the Ajaokuta Presidential Project Implementation Team.

The implementation team was commissioned to prepare and submit periodic work plans and develop concession contract terms towards reviving Ajaokuta Steel Company Limited.

Activities related to LEAD and ZINC mining are ongoing in Nigeria. While some small-scale quantities of lead-zinc ores are exported in their crude form, no concrete steps have been taken to process the ore to metal.

In 2017, the Nigeria Extractive Industries Transparency Initiative (NEITI) reported that three of the 26 minerals exported accounted for 73.81% of total exports. The commodities are zinc ores and concentrate, lead ores and concentrate, and silica sands and quartz.

BARITE

Barite is a mineral that occurs extensively in Nigeria. Its usage ranges from oil and gas exploration to other industrial uses. Recently, the Ministry of Mines and Steel Development announced support for local mining and production of barite as an import substitution for foreign sourced barite.

Nigeria has very large deposits of bitumen, however the mineral has been largely untapped, and bitumen is still imported to meet domestic demand and consumption.

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