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Nigeria looks to mining to diversify revenue stream —Minister



Nigeria is nursing the hope of having 50 mines in operation by 2023 and can make up for lost time because of the weight of the coronavirus crisis on the growth of the promising sector, Reuters reported Wednesday, quoting Minister of Mines and Steel Development, Olamilekan Adegbite, as saying in an interview.

The country is looking to mining to diversify its revenue and revitalise its finances after the tap of oil money ran dry when the prices of oil, which provides about 65% of government revenue, hit record lows in April.

“The pandemic has slowed things down, but we can still catch up,” Adegbite said.

Government believes mining will expand by 1000% in five years to provide 3% of the economy and that Nigeria can simultaneously process and mine, which produces higher profits compared to raw materials shipping.

Adegbite said the country sought to process barite, in particular, which is used in drilling for oil and gas, and sell to countries like South Africa and Ghana, which need the mineral to prospect for oil in new areas.

Like other African nations, Nigeria also plans to formalise artisanal mining, which could generate tax and royalties from gold.

He stated that Africa’s biggest economy was urging small-scale miners to form cooperatives and sell at government-buying centres, where prices are closer to global values than those offered by illegal buyers.

Read also: Military arrests 150 suspected bandits in illegal mining site in Zamfara

Even though oil prices have been low on account of the effects of the pandemic on movement and industry, which has limited fuel demand, gold touched its record highs in August.

A major challenge for the country is that a vast portion of its gold lies in the northwest, where humanitarian bodies say it has helped to stoke violence attributed to armed groups.

Adegbite said security had improved and buying centres would stop artisanal miners dealing with criminals.

“By weaning them off the illegal people and making sure they sell to government-approved centres, you take off that linkage.”

He is optimistic more commercial gold miners will be attracted once Thor Explorations’s gold mine in the southwest begins producing. The firm’s first gold is expected in the second quarter of next year.

But the vice president of London-based risk consultancy Teneo Intelligence, Malte Liewerscheidt, feels plans will be undermined by “structural challenges pertaining to insecurity and infrastructure deficiencies.”

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