In a move to diversify the economy, the federal government yesterday approved N30 billion intervention funds for the mining sector which will be focused on exploration.
Speaking to State House correspondents after the Federal Executive Council meeting (FEC) presided over by President Muhammadu Buhari at the presidential villa, minister of solid minerals, Kayode Fayemi, who was accompanied by his counterparts in aviation, Rotimi Amaechi, and information, Lai Mohammed, said Nigeria needs investment-grade geological data for those in mining to be gainfully engaged in the sector.
According to him, FEC rectified the president’s anticipatory approval for ministry of mines and steel development to qualify to access the national resources fund.
Fayemi recalled that, in August, FEC had approved the road map for the growth and development of the mining sector.
He said: “In recognition of Mr President’s campaign promises to Nigerians and, in particular, his consistent statement to ensure diversification, particularly in agriculture and mining sector, Council rectified his approval of N30 billion intervention fund for the mining sector. It will be highly focused on exploration. Exploration is the heart of mining; if you don’t search you won’t find.
“You have heard all sorts of talks about how rich Nigeria is in mineral resources, but the quantity, quality, the geological prospectivity has been a challenge because we have neglected the sector for such a long time.
“If we really must attract mining investment into the country, we need investment-grade geological data for those who are in mining to be engaged in the sector.”
He noted that government was a taking a cue from what has been done in other countries even smaller than Nigeria, like Ghana, Cote d Ivoire and Burkina Faso, with the latter spending an average of $300 million a year on exploration.
He explained that the fund is from the natural source development fund put at 1.68 per cent of the federation account and equivalent to the ecological fund and the Education Trust Fund.
According to him, it is meant primarily for the agriculture sector, water resources sector and mining sector, and will cover exploration, research and development in partnership with universities.
He added that the money will also cover security and mining in partnership with the ministries of Interior and Defence and the Directorate of State Services (DSS), which will also collaborate to tackle the menace of illegal mining across the country.
He emphasized the importance of inter-ministerial coordination for the aims to be achieved.
“We are to work with the Ministry of Transportation, Power, Works and Housing and Environment on safer mining practices, and Ministry of Health to ensure that whatever we do eventually can help us build a multi-sectoral focus on mining and also encourage private sector investment in the sector.
We are already in negotiation with sovereign investment on mining
to also access private capital as well as the Nigerian Stock Exchange. The guidelines will be ready in a month,” he said.
On his part, transport minister, Amaechi, explained that for the transport sector, there is an attempt to concession the railways to General Electric (GE), and that council had approved the advisers that would sit with GE as well as Nigerian experts to negotiate.
He pointed out that the narrow gauge railway will, to a great extent, assist the agriculture, mines and steel development ministries in the transportation of the extracted minerals.
Amaechi said, “We are rehabilitating – at no cost to government – the Port Harcourt-Maiduguri line, which include Port Harcourt, Aba, Umuahia, Enugu, Makurdi, Jos, Gombe, Bauchi to Borno. Then Lagos to Kano will include Lagos, Abeokuta, Ibadan, Ilorin, Kano, Funtua, Zaria and to Kauradamuda. We are rehabilitating all of them.”
According to the minister, the rehabilitation will encourage movement of cargoes and passengers.
“GE will do everything required to rehabilitate, including investment and other railway infrastructure.GE is proposing to manage for 25 years to recover their investments. Nigerian government has not agreed and that is what our advisers will sit with GE to agree.”