The Nigerian Mining sector is facing a critical challenge as state governments’ interference in mining operations has sparked significant concern among industry stakeholders. In this stead, the Forum of Concerned Stakeholders in the Nigerian Minerals and Mining Sector has voiced its concerns over what they describe as unconstitutional actions by various state governors. These concerns were highlighted during a news conference in Abuja, where several key figures in the industry gathered to address the growing crisis.
Prof. Olatunji Akinade, the President of the Nigeria Mining and Geosciences Society (NMGS), who spoke at the conference, expressed alarm over the increasing regulations imposed by state governments. According to Akinade, these actions are not only discouraging Investment in a sector that is crucial to Nigeria’s Economic Diversification but are also in direct violation of the Nigerian Constitution and the Nigerian Minerals and Mining Act of 2007. Both of these legal frameworks grant exclusive control of Mineral resources to the federal government, leaving little room for state-level interference.
Many of those actions have significantly reduced investor confidence.
Akinade explained the current state of affairs, noting that the unchecked actions of state governments have created a chaotic environment for its operations. Mining sites are being forced to close, and equipment is being taken, all in direct violation of federal laws. he lamented. This action by state authorities, he argued, has significantly reduced investor confidence, posing a serious threat to the federal government’s efforts to attract investment into the sector. The call for action is not just about preserving the rule of law; it’s about ensuring that the sector can thrive and contribute to the nation’s development.
Representing the collective voice of these stakeholders, he called on the Minister of Solid Minerals Development, Mr. Dele Alake, to take decisive action against state-run regulatory agencies in the mining sector. He stated that these agencies operate outside the bounds of federal law and should be declared illegal. Furthermore, He voiced concerns about recent increases in fees, rents, and royalties within the sector. These hikes, implemented without adequate consultation with industry players, threaten to push many operators out of business, especially in the current challenging economic climate.
Several initiatives have been instrumental in the sector’s growth.
Despite the challenges, he acknowledged the positive steps taken by the federal government, particularly the completion of the Mineral Sector Support for Economic Diversification (MinDiver) Project in May 2024. He noted that initiatives such as the Nigerian Mineral Decision Support System and the National Geodata Center have been instrumental in fostering growth within the sector. However, he criticised the ongoing review of the Mining Act, which he believes lacks sufficient input from key stakeholders. Akinade warned that excluding them from the legislative process could result in the laws not achieving their purpose.
In response to these challenges, Akinade proposed several measures to safeguard the future of Nigeria’s mining industry. He emphasised the need to align the Mining Marshalls operations with federal departments and called for the decentralisation of mineral title and permit approvals for efficiency. Additionally, he stressed the importance of urgent reforms to prevent the sector from further decline. The success of the industry, which holds immense potential for economic diversification, hinges on a collaborative effort between the government and industry stakeholders.
Related Article: Nigeria requires a data-driven mining sector
Lastly, the conference was attended by prominent figures in the mining industry, including Dele Ayanleke, National President of the Miners Association of Nigeria; Dr. Umar Albarka Hassan, President of the Nigeria Society of Mining Engineers and Engr. Janet Adeyemi, National President of Women in Mining in Nigeria. Other attendees included Engr. Adeniran Ajibade, President of the Gemstones Miners and Marketers Association of Nigeria; Hon. Kelvin Dele Oye, National President of the National Association of Chambers of Commerce, Industries, Mines, and Agriculture; and Alhaji Sani Shehu, Chairman of the ECOWAS Federation of Chambers of Mines.