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‘N20bn for solid minerals exploration in 2018, a strong step towards diversification’

The revelation that the Federal Government has earmarked N20bn for exploration activities in the solid minerals sector in 2018 has been welcomed by industry stakeholders, saying this is the first ever strong move made in the resuscitation of the sector in the last couple of years.

The Minister of Mines and Steel Development, Dr. Kayode Fayemi, disclosed this at the 2017 end of year ministerial press briefing held in Abuja recently.

According to him, the approval is not unconnected with giant leap in revenue generation recorded in 2017 by the sector which shored income to over N3.5bn in between January and November 2017 from a paltry N2bn recorded in 2016.

Key aspects of the new funding arrangement include building of ultra modern gold reserve from 2018 by purchasing gold from local miners in Osun and Kebbi states in a scheme to be managed by a Special Purpose Vehicle to be licensed by the government.

Part of the plan is that by December 2018, two processing plants would begin processing of bitumen in the country.

Fayemi said the N20bn to be spent on exploration activities next year would be sourced from the N30bn approved by the government from the Natural Resources Intervention Fund, adding that the ministry was able to access the first N10bn from the fund in 2017.

The Minister also recalled that “In 2017, a new board for the Nigerian Solid Minerals Development Fund was inaugurated and a competent management put in place. In collaboration with the Bank of Industry, the SMDF has launched a N5bn fund to provide single-digit interest loans to mining projects in Nigeria.

“Also, we have partially accessed the N30bn approved for the sector from the Natural Resources Intervention Fund for the promotion of the exploration of new minerals and to strengthen the regulatory capacity of the ministry.

“Consolidating on our feat of achieving 300 per cent increase in revenue (royalties and fees) between 2015 and 2016, we steadily progressed in 2017, and as of November of this year, the sector had already surpassed the entire revenue of about N2bn generated for the whole of 2016, with over N3.5bn contributed to the Federation Account so far.”

However, the minister was quick to note that one of the key projects we are embarking upon in 2018, in partnership with some state governments and the private sector, is a gold purchase scheme. The mandate of the scheme will include equipping of the artisanal miners; provision of extension services; and the off-take of all the gold produced by the participants in the scheme.

He stated that “The aim is to facilitate employment creation, poverty reduction and increase in revenue to the Federation Account”.