Investors Losing Interest in Nigeria’s Mining Businesses as Insecurity Bites Harder

Business gurus and investors are gradually losing interest in investing in the mining sector of Nigeria.

Investors King discovered, through a presentation document by the Minister of Mines and Steel Development, Olamilekan Adegbite, at the ninth edition of President Muhammadu Buhari’s administration.

The president has been rendering his scorecard that spans from 2015 to 2023. The programme is being organised by the Ministry of Information and Culture.

In the mineral sector, there are mining, exploration, quarry, and small-scale mining industries, of which have been serving as the country’s money spinners after the oil and gas industry.

But, growing insecurity in the mining environments has been the bane of the sector.

The sector had suffered no fewer than 363 casualties during different attacks and clashes between 2016 and 2022.

During the attacks on the mining sites, communities and miners across the country, activities have been affected as workers abandoned some areas considered dangerous.

Number of casualties including those killed, kidnapped, or injured during attacks and clashes has been on the rise

The 363 casualty figure is contained in a data obtained from the daily incidents recorded by the Nigeria Security Tracker, a project of the Council on Foreign Relations, an American think-tank, during the period under review.

Flowing from this disturbing incidents, it was gathered that there have been a decline in the figure of licences issued to interested investors in the sector.

The document presented by Adegbite showed that 2815 mineral titles were issued in 2016, while 1438 were issued in 2021.

Also, the total number of mineral titles issued to mining companies has dropped by 36.63 per cent within a period of five years.

Adegbite said that 2,258 mineral titles were issued in 2016, 2429 in 2017, 2124 in 2018, and 1,620 in 2019.

He added that 1,438 mineral titles were issued between January and October 2022, which is a 48.92 drop per cent from what was issued in 2016.

However, the Director-General of Nigeria Mining Cadastre Office, Mr Obadiah Nkom, during a State House briefing organised by the Presidential Communications Team, had said that 3,402 titles were revoked for defaulting on the terms of their licences.

The mining rights of companies that were not using their licences were said to have been revoked, leaving NMCO to generate over N3.7bn in 2022.

It was gathered that aside the revocation of the licenses owing to default, the mining sector has been characterised by insecurity.

Recall that the Federal Government had banned mining activities in Zamfara State in March 2021 owing to incessant attacks.

Buhari approved the recommendation that mining activities in the state should stop while declaring a no-fly zone on Zamfara.

The Federal Government was considering a ban on the use of motorcycles and mining activities sequel to the terrorist attacks on the Kuje Correctional facility on July 5 as well as others witnessed nationwide.

Stakeholders including industry players under the auspices of the Miners Association of Nigeria, had urged the government to address the issue of worsening insecurity rather than banning mining activities even as sector witnesses low patronage.