The Ministry of Mines and Steel Development is considering disbursing N200 million to 100 artisanal miners to boost mining activities in Nigeria.
The Minister of Mines and Steel Development, Olamilekan Adegbite, made the disclosure in an interview with the News Agency of Nigeria (NAN) on Sunday in Abuja.
He said that the fund would be drawn from the ministry’s N3.2 billion mining intervention fund, domiciled with the Bank of Industry (BoI).
Mr Adegbite explained that two million naira each would be given to 100 artisanal miners to help them to operate their businesses.
He said that the ministry had an agreement with BoI in 2017, to contribute N2.5 billion, totalling N5 billion as intervention fund for artisanal and small-scale miners.
“The concept is that we give 2.5 billion naira to BoI in partnership and that BoI should add its N2.5 billion to make it N5 billion for the intervention fund.
“BoI is meant to disburse the fund because of the ministry’s past experience that the World Bank gave the ministry some funds to be disbursed to miners but it was not successful.
”That is why Governor Kayode Fayemi, the then minister of this ministry, gave the money to BoI, whose core mandate is to disburse the fund to miners that meet the criteria attached to the loan.”
Mr Adegbite said that due to the stringent criteria attached to the loan by BoI, miners were unable to access the fund, adding that the ministry’s 2.5 billion had accrued interest of N1 billion from 2017 till date.
“Between 2017 till date, our N2.5 billion with BoI generated N1 billion interest, making it N3.5 billion but N300 million has been disbursed from our fund to some miners. We now have N3.2 billion remaining.
“The purpose of the fund is not to generate interest for the government. It is to develop the sector. We have relaxed the conditions attached to the loan to enable artisanal miners to access the fund.
“The criteria now is that artisanal miners can access the fund by getting a surety, an officer from grade level 14 upward.
“We decided to take N200 million from the N3.2 billion and loan it to 100 artisanal miners that meet our criteria.”
NAN learnt that the loan is to be made available at a single-digit interest rate of five per cent to address the lack of funds militating against artisanal and small-scale mining activities.
Mr Adegbite also said on Sunday that the African Continental Free Trade Area (AfCFTA) initiative would help to stem illegalities in the mining sector.
Speaking on how to promote solid minerals export to maximise the potential and benefits of AfCFTA, Mr Adegbite expressed his optimism that AfCTA would discourage illegal mining.
“Right now, many Nigerians are into artisanal mining and this was caused by the fact that when oil was discovered, Nigeria moved away from mining, which was the mainstream of the economy.
“Before oil and gas, Nigeria relied on coal and tin; we were exporting and were indeed, quoted on the London Metal Exchange.
“And that is basically what was giving Nigeria money in those days before oil came but when oil came, we moved away. We left mining behind.”
The minister recalled that the Indigenisation Decree of 1973 sent many companies out of Nigeria.
This, he said, resulted in many workers being laid off by the companies they were working at, making some of them to resort to artisanal mining.
Mr Adegbite noted, however, that the artisanal miners did not have formal experience or skill in mining, making them engage in subsistence mining to make their livelihoods.
“Some people now exploit this and they aggregate whatever they mine and take them out of Nigeria illegally.
“Gold is the most traded mineral in Nigeria and these people mine gold and get nuggets. There are several thousands of such miners, when you aggregate what they mine, it comes in large volume and several kilos of gold.
“To know the extent of the money they make in the gold business, they hire private jets to take them out illegally because they realise a lot of money.
“At the rate gold is selling, one ounce of gold is selling for $2,200 and by the time you carry a thousand kilogrammes, you are making several billions of naira.
“But with AfCFTA coming into effect, we hope that other countries will cooperate with Nigeria because now it is a free trade but there is documentation.”
Mr Adegbite lamented that a lot of the illegal miners used neighbouring countries, especially Niger Republic, as route to get to their destinations.
The minister argued that there must be active connivance of highly placed people because one would not fly a plane into another country without clearance in such a country.
“They essentially fly the planes into neighbouring countries and take the minerals through our land borders.”
Mr Adegbite recalled that during the COVID-19 pandemic, people helped the ministry with videos of how gold was being taken out of Nigeria.
“During the COVID-19 lockdown, no flight was coming into Nigeria and they were getting the quantity of gold they needed to take to Dubai.
“So, with AfCFTA coming into effect, we hope this will help to stem the problem because now we are supposed to trade freely among ourselves with documentation.
“We hope that other countries will cooperate with Nigeria. I will not allow such illegal activity to go on within those countries,” the minister vowed.
Nigeria joined 53 other African countries on January 1 this year, to set AfCFTA in motion.
AfCTA, the world’s biggest trade bloc, was established to speed up intra-continental trade.
The minister also said the federal government has given N6 billion lifeline to the Ministry of Mines and Steel Development to tackle the economic impact of the coronavirus pandemic.
He said the lifeline, to serve as a palliative for the sector, would be expended on setting up six mineral clusters in the country’s six geo-political zones.
“During the lockdown, I was invited by the Vice-President, Prof. Yemi Osinbajo, to come up with things to be done during post-COVID-19 to help stimulate the mining sector.
“Six billion naira was given to our sector as palliative. We came up with setting up of mineral clusters in the six geo-political zones. We have six regions in Nigeria and we are doing six projects.”
Mr Adegbite said that the ministry came up with the building of a Gold Souk in Kano in Northwest Nigeria, to boost gold trade and processing in the state.
“We used to have goldsmiths in Nigeria but the profession is fading out. We want to bring it back. People now take our gold to Dubai, to add value.
“If you take a quantum of raw gold worth N10,000 to Dubai, they will refine it without adding anything and create earrings, bangles and other jewelries and sell them 10 times the value they bought it.
“Why can’t we make the value locally that is what we are doing now. The concept in Kano is to revive and retain the value of our gold and create employment.”
He said that Bauchi State was selected in the Northeast for its abundant kaolin, noting that the mineral was being imported by pharmaceutical and paint companies in Nigeria.
“The mineral is used for the production of mixed kaolin and other drugs. Bauchi State has a lot of kaolin and we are planning to develop them.”
Mr Adegbite said that Kogi was selected in the North Central as the state was also blessed with gold, adding that the ministry would build a smelting plant in the state to aggregate the gold.
He said further that Ibadan in Oyo State was selected in the Southwest for its abundant gemstone market.
“The gemstone market in Ibadan is informal and the government is not getting anything out of the mineral. Therefore, the government is now going to formalise it.
“It is an international market. People come from outside the country but we are being cheated; we are going to regulate the market.
“We are also going to train people on gemstones cutting and polishing to add value to the mineral.”
Mr Adegbite said that Ebonyi in the Southeast was also selected, due to its large quantum of lead mineral, adding that a smelting plant would be built in the state to boost the activities of artisanal miners in the zone.
The minister said that Calabar was similarly chosen in the South-south for its abundant Barite mineral.
It will be recalled that the Cross River government had approved five hectares of land for the mines and steel development ministry for the cluster project.