Nigeria will remain an attractive mining destination if the government continues to ensure the continual gathering of geological data, ensures that policy and regulation is investor-friendly and commits to the development of a local financial ecosystem.
This is according to panellists speaking at a recent webinar on investing in Nigerian mining. GERARD PETER reports.
The webinar titled, Driving investment in the Nigerian Mining Sector during the COVID-19 pandemic was held in the lead-up to the Nigeria Mining Week Digital Event in October this year.
The panel featured Arc. Olamilekan Adegbite,Minister of Mines and Steel Development of Nigeria; Engnr. Abdullahi A Sule, Executive Governor of Nassarawa State; Cyril Azobu, head of consulting: West Market Area, PWC Nigeria; and Emma Priestly, consultant and executive director at Goldstone Resources.
In his opening remarks, Adegbite admitted that the government’s progress in making Nigeria a top African mining destination has been stymied because of the coronavirus pandemic.
However, he is confident that development of the mining sector remains on path. “With a well outlined growth strategy in place and in play, we are still poised for good short to mid-term growth as investors move to capitalise on various commodities,” he stated.
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Priestly echoed the minister’s sentiments by adding that in the two years prior to the COVID-19 pandemic, she has witnessed considerable changes in mining investor’s attitudes toward Nigeria.
“A is Thor Explorations’ development of its Segilola gold project. This is the first mine that has been developed in Nigeria for several decades but is showing that developments.”
Meanwhile, Adegbite added that a number of initiatives are in full swing in order to garner investor interest in the country.
“The most important thing is the availability of geological data. Now, for the first time, the government has extra budgetary funding that allows us to embark on nationally integrated exploration programmes.
“Secondly, we have implemented a policy that creates an enabling environment to conduct business effortlessly. We have also put incentives in place to attract investment such as tax holidays and duty waivers for mining equipment. We are also working on developing infrastructure such as a rail network to assist mining companies,” he added.
Investors looking for guarantees
Meanwhile, Azobu weighed in on the conversation stating that government regulations are key as investors are stability in political and fiscal policies. “Investors are looking for security of tenure.
“Also, COVID-19 has resulted in the devaluation of the Nigerian currency so they want to ensure that foreign currency policies and the exchange rate remains stable. They want low costs with high returns and mining is an area where good ROI can be achieved.”
Sule added that all state governments have realised the importance of mining as the country tries to move away from its oil-based mono economy.
“For example, in Nassarawa, we are formalising the entire business. This includes facilitating dialogue when there is conflict between mining parties and local communities,” he added.
Rounding up the discussion, Azobu stated that COVID-19 should not be a reason to dissuade investing in Nigerian mining.
“It takes a few years to plan a mine and you only reap the rewards later down the line. So it is important that we continue to drive investment in the sector even during the pandemic,” he concluded.