EITI IMPLEMENTATION: APPLICATION OF EITI TO THE SOLID MINERALS SECTOR IN NIGERIA.

2012-03-08 16:26
Africa/Lagos

EITI IMPLEMENTATION: APPLICATION OF EITI TO THE SOLID MINERALS SECTOR IN NIGERIA.

Agbaji Emmanuel OGEZI, FNMGS.  Department of Geology & Mining, University of Jos. (

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1.0. INTRODUCTION.


1.1.Preamble

With gratitude to Almighty God, the presenter thanks the Federal Government for setting up the Nigeria Extractive Industries Transparency Initiative (NEITI) in February 2004, even though the NEITI Bill was only signed into law on 28th May, 2007.

He thanks the National Stakeholders’ Working Group (NSWG) (NEITI Governing Board), the Executive Secretary, Management and staff of NEITI, and all participants for the honour and privilege of being invited to make this largely non-technical presentation on: “EITI Implementation: Application of EITI to Solid Minerals Sector in Nigeria” today at this well-organized high-level Conference with the theme- Delivering Transparency, Reaping Accountability and Prosperity”. Prior to this Conference, NEITI had over the years organized several training and enlightenment workshops for journalists, judges and judiciary staff, civil society organizations (CSOs), etc to enable them play their expected roles of advancing transparency and accountability more effectively and for displaying greater efficiency in the implementation of NEITI principles and objectives. The NEITI principles and objectives, as contained in the NEITI Act 2007, include promoting due process and transparency in extractive industry revenues paid to and received by the Federal Government as well as ensuring transparency and accountability in the application of extractive industries revenues. NEITI is the Nigerian sub-set of the global extractive industry transparency initiative (EITI) (Table 1) with identical aims of achieving transparency and accountability in the management of revenue flows from the extractive sector of the Nigerian economy as in other EITI member and candidate countries shown in Table 1.

NEITI Act, 2007, under Section 21, defines: “Extractive Industry Company” “as any company in Nigeria that is engaged in the business of prospecting, mining, extracting, processing and distributing minerals and gas, including oil, gold, coal, tin, bitumen, diamonds, precious stones and such like; and includes any agency or body responsible for the payment of extractive industry proceeds to the Federal Government or its Statutory Recipient.” Hence, all private and public companies and agencies involved in the minerals industry system (MIS) or the mineral supply process (MSP) are included. MIS/MSP ranges from exploration through evaluation, development, production, processing, manufacturing and marketing of solid minerals, oil and gas. Hence, according to the enabling NEITI Act, 2007, the extractive industries (EI) should include mining, quarrying and (ground) water extraction in addition to oil and gas industries. Therefore, implementation of EITI principles should include the solid minerals sector as contained in the NEITI Act 2007. Worldwide, forestry and fisheries are also included in the EI. As shown below and in Table 2, oil and gas and solid minerals have several similarities: they are formed very slowly over long and comparable geological times, and under similar physical, chemical and environmental circumstances below the Earth’s surface. They are, however, extracted much faster than formed and they are, thus, exhaustible (Table 2). The extractive industries as a whole have a number of peculiar features and risks. MIS/MSP phases/stages may take periods of up to 10-20 years. They, therefore, have long gestation or lead periods during which funds are expended but revenue is hardly earned. All expenses, including exploration, development and licensing expenses are paid upfront before production/extraction begins. Over this long, other risks include long non-revenue earning period as well as legislative, security, political, environmental and fiscal/economic issues which might have changed drastically during the gestation period. Also, new technology might have reduced the value/use of the extracted material 10-20 years on! In addition, there are technical risks and unknown factors associated with the natural geological occurrence of the resource, whose existence can only be confirmed during drilling or extraction. For private investment to be profitable and sustainable, therefore, incentives, conducive operating environment and revenues must be reasonable. Governments must, hence, balance adequate taxes, and safety, health and environmental (SHE) issues with private profit (SHEP). This careful balancing should be based on data gathered largely through AUDITS, as in the forthcoming NEITI solid minerals, oil and gas as well as previous oil and gas Audits.    

Since its commencement in 2004, several major activities have been carried out by NEITI National Stakeholders’ Working Group (NSWG) (NEITI Governing Board) and Management. These include commissioning of the Financial, Physical and Process Audits of Nigeria’s oil and gas industry for 1999 to 2004, the first comprehensive audit of the industry since crude oil was discovered in 1956. It is available on the internet at www.neiti.org.ng. The Financial Audit mapped financial flows and their chain of custody in order to identify and confirm the role and performance of specific players as well as payments made, received and accounted for. Players include oil companies, Central Bank of Nigeria (CBN), Office of the Accountant-General of the Federation (OAGF), Federal Internal Revenue Service (FIRS) and Department of Petroleum Resources (DPR). The Physical Audit mapped the oil industry’s oil and gas and refined product flows and checked whether the extracted volumes were accurately reported and agreed with data used by FIRS and DPR (for taxes and royalty payments). Data provided were largely unreliable and oil was measured at different points. The Process Audit examined how key Agencies and Departments managed five key areas of business, as well as the processes in place for upstream licensing, crude oil marketing, refining and product imports, and for budgeting, capital and operating expenditures. Audits for 2005-2008 were later commissioned and the findings communicated to stakeholders. Others activities include collaboration with stakeholders to communicate findings, rectify lapses, and build capacity. Unfortunately, no similar audit has yet been carried out for the solid minerals and other extractive industries sub-sectors (e.g. forestry and fisheries), although a 2007-2010 Audit is planned for the solid minerals in 2012. This is particularly significant in view of the fact that prior to first export of crude oil in 1960, other extractive industries’ resources- solid minerals (coal, columbite and tin), agricultural commodities (cocoa, groundnuts, cotton and palm oil), and forestry products (timber and rubber) largely sustained the Nigerian economy. Extraction of these resources largely led to socio-economic development in the decades prior to the 1970s, apparently also due to the then more judicious and transparent management of extractive industries revenues. The lessons learned from oil and gas sub-sector audits, when applied to other EI sub-sectors, would significantly enhance EI governance, due process, transparency and sustainable environment and resources development in Nigeria. Nigeria is widely acknowledged for being at the forefront of EITI implementation globally and for its exemplary engagement with Civil Society Groups. During the Fifth EITI Global Conference, held in Paris in March, 2011, the EITI Board designated the Government of Nigeria as EITI Compliant as of 1st March, 2011. Nigeria is, thus, one of ten (10) EITI Compliant countries along with Azerbaijan, Central African Republic, Ghana, Kyrgyzstan, Liberia, Mongolia, Niger, Norway, and Timor-Leste. Twenty-five (25) other countries are at various stages of being fully compliant and are in Groups 2 to 6 with status of “Candidate” (Groups 2 to 5) and “Others” (Group 6) (Table 1). The EITI Board congratulated Nigeria for its commitment to the EITI process, and also congratulated the Nigerian Multi-Stakeholder Working Group (NSWG) and the NEITI Secretariat for its strong collaboration and effective oversight of EITI implementation. EITI Board in March 2011 welcomed the Government of Nigeria’s commitment to further strengthen implementation by incorporating the revenues from the solid minerals sector to the EITI reporting process. As a result, the Governing Board of NEITI (the NSWG) decided at its meeting of 20th May, 2011 to carry out, “The comprehensive audit of oil, gas and solid minerals sector is to cover the period 2009-2010”. A Scoping Study to provide guidance on the “materiality points/levels” and, through this determine the companies to be involved in this proposed 2009-2010 Solid Minerals Audit was carried out by an international consortium of Danish and Nigerian companies and the report was presented in September 2011 (FRN, 2011). In applying the EITI principles to the solid minerals sub-sector, however, it is important to note key differences and similarities between the solid minerals and the oil and gas sub-sectors (Table 2). The first NEITI Mining Stakeholders’ Meeting took place on 24th July, 2006. Since, as shown above, the scope of NEITI also includes the solid minerals sector, it is important that NEITI shares its empirical knowledge of implementing transparency and due process in the oil and gas sector with the budding Nigerian solid minerals sector. This would ensure that the environmental and socio-economic mistakes made in the oil and gas sector are not repeated in the solid minerals sector which is, relatively speaking, still in its infancy. Also, unlike oil (which is at present produced only in nine (9) southern States), economically exploitable solid mineral deposits of various types and sizes are known in all the 36 States and Abuja Federal Capital Territory (FCT). Their extraction would produce significant negative and positive impacts and these need to be appreciated from inception. The forthcoming Audits would contribute to these. 

According to a recent January 2012 newspaper reports, quoting Dr. Orji Ogbonnaya Orji, Director of Communications of NEITI, two indigenous and independent auditing firms were selected by NEITI and later approved by the Federal Executive Council (FEC) to conduct the oil and gas industry audit from 2009 to 2011 and also for the solid minerals, whose audit is just commencing, with effect from 2009 to 2010. According to the report, the oil and gas audit would be conducted by Sada Idris & Co. for N226.6 million, while Haruna Yahaya & Co is to conduct the first-ever Nigeria’s solid minerals audit. Timely completion of the 2009-2011 O&G Audits would bring NEITI up to date in compliance with the rules of global EITI and NEITI national mandate. Execution of the 2009-2010 solid minerals sector audit after the successful 2011 scoping study of the sector would open up the sector to foreign direct investment (FDI), good corporate governance and minimize some unwholesome/illegal activities which currently afflict the sector under informal (illegal mining, processing and sale) operations. When completed by December 2012, current and accurate data and information for planning, management and legislation would be available to Government, legislators, investors, civil society and the media from the comprehensive EI audits. Good governance in the extractive industries, in general, would also ensure that the Federal Government Amnesty Programme to Niger Delta militants, the bane of “resource curse” and “resource control” and resources-induced wars and conflicts (which have afflicted many resources-rich countries, including Nigeria, that have poor governance structures) are minimized. The January 2012 National Labour Strike and public demonstrations over the removal of fuel subsidy clearly demonstrate the need for greater transparency and improved governance in the extractive industry sector. Such a scenario would again result largely from independent data obtained from the forthcoming and past NEITI Audits which are backed by the 2007 NEITI Act aimed at enthroning transparency, accountability and good corporate governance in the extractive industries sector- a current major national concern. The Ministry of Petroleum Resources has set up Committees to advise it on governance issues, the Petroleum Industry Bill (PIB) submitted to the National Assembly in 2008, etc and later in February set up the Petroleum Revenue Special Task Force (PRSTF) to determine and verify all revenue due and payable to the Federal Government. PRSTF would apparently be performing functions that look similar to those being carried by NEITI already.

.2. Oil and Gas and Solid Minerals Compared

The extractive industries (EI) are the organized commercial organizations whose task it is to search for, find and produce/ mine (extract) the Earth’s natural physical resources from below or at the Earth’s surface in a sustainable, profitable, safe and environmentally and socially friendly fashion. There are a number of similarities between solid minerals and oil and gas with respect to their mode and processes of formation, time and duration (or periods) of formation, and the places or environments of formation (PPP concept, for example, in Ogezi, 2008). The development and production of oil and gas and the solid minerals sectors also have similar positive and negative socio-economic, biological, hydrological and other impacts on man and the environment (Table 2). Some differences are due to their normal physical states (solid, liquid or gaseous), and differences in socio-economic and environmental impacts (Table 2). Hence, on the major geological, technical, socio-economic and environmental factors, there are several similarities between the oil and gas sector (the major focus of NEITI so far) and the solid minerals sector. These similarities support the application of EITI principles to the solid minerals sector of the Nigerian economy. Although revenue from tin, columbite and coal (together with agricultural and forestry products- other EI resources) facilitated opening up and development of Nigeria up to the 1960s, (apparently due to more judicious revenue management then), the much higher oil revenue since the 1970s has not resulted in similar impacts. This again justifies the 2004 set-up of NEITI and the subsequent impacts of the Financial, Physical & Process Audits.

1.3. Definition of Terms

Geology is the study of the Earth, its origin, history, formation, materials in them and the processes that affect the Earth and other planets, including the applications of these studies. The study of the abundance, distribution and redistribution of the Earth’s resources is, in its more basic aspects, a branch of geology, called geochemistry. Another related branch of geology, called environmental geology, is concerned with many issues, such as the concept of sustainable development, relevant to natural resources and the wealth generated from their socially and environmentally sustainable exploitation as well as the judicious and transparent use of the revenue so generated. One of the simplest ways of classifying the Earth’s physical (natural) resources is to sub-divide them into renewable and non-renewable resources. All life forms draw resources from the Earth. Man has systematically used available resources to shape controlled living and environment we call civilization. Fisheries and agricultural and forestry products which can be replaced seasonally, yearly or at regular intervals and are derived from present-day living organisms on the Earth’s surface are renewable resources. Oil and gas were derived from formerly living (largely marine) micro-organisms, while minerals (except coal and bitumen) are derived from non-living (inorganic) substances. The solid minerals and petroleum (crude oil and gas) take very long time (millions of years) to form at great depths in the Earth’s outer layer or crust. Since they take many generations to form while they can be extracted, used and depleted much more rapidly in a few years, they are non-renewable or depleting resources. Water, which is also an extractive industry product, could be regarded as intermediate reusable resource between the easily renewable (fisheries and forestry) resources and the largely non-renewable, depletable or exhaustible mineral (and petroleum) resources so long as the groundwater is not pumped out faster than it is recharged. This is because as a result of the hydrological cycle, groundwater may be renewed annually or over a longer period. Nearly all products that make life more comfortable (clothing, housing, transportation, communications, drugs, electricity, food, clean water) all rely on or come from extractive industry (EI) products and their use by man (Table 3). Exploiting, using and finally disposing of these EI resources, however, may have major consequences or impacts on man and the environment and they also consume large amounts of energy and water. Sustaining civilization and continuing population expansion, raise two key questions, the answers to which provide the key to the long-term future of man and his civilization. The questions are about the maximum rate renewable resources can be produced or extracted without irreversible degradation of the Earth’s surface, and the second is about civilization- whether the Earth contains sufficient resources to support and expand man’s increasingly complex civilization. For sustainable development we, thus, need to understand the nature, uses, impacts and limits of extraction of the Earth’s natural (EI) resources (Table 3).

Physically variable mixtures or aggregates or combinations of two or more minerals in various proportions make up the different rocks. An unusually significant or abnormal concentration of a mineral in a place is called a mineral occurrence. When such an occurrence can be extracted profitably (and safely) within the prevailing economic, environmental and technological conditions, it is a mineral deposit. Substances which contain useful materials (extractable now or in the future) are resources. If the technical details (grade/quality and quantity, etc) of the deposit have been well established (based on careful geological mapping, drilling, analysis, etc), and it can be extracted safely and profitably in the prevailing technical and economic environment, it is a reserve. With advances in technology and market forces, resources can, thus, become reserves. Resources may be of the proved or inferred category, depending on the level and accuracy of knowledge available on them. When a reserve can be profitably and safely exploited in an environmentally- and socially-friendly fashion and it is in demand (based on the uses, locations, physical and chemical properties), it is extracted. To safely and profitably extract natural resources, adequate geological knowledge is required for the hidden/exposed materials to be unearthed or exposed with minimal negative environmental and social consequences and health and safety taken care of. Mining, or extraction of metallic ores, is a very old profession indeed and it was probably only preceded by agriculture. Mining and the exploitation of other extractive industry products are probably older than history itself because even in pre-historic times, mining, quarrying, fishing and logging (that is, the extractive industries) and agriculture provided man’s basic materials and tools for obtaining food, shelter and fuel. As documented in the Holy Bible in Moses’ book of Genesis in Chapter 2, verse 7, God is recorded as the very first miner when He took clay/soil from the ground and formed a man out of it! The Holy Bible also has various records of the early use of minerals, gemstones and metals and various historical periods are named after the predominant materials, metals or mixtures of metals (alloys) that are used at that particular period of man’s history. Some examples include the “Stone Age”, “Iron Age”, “Bronze Age”, and the “Steel Age”, which is probably still on.

1.4. Scope

The economy of all African countries, including the Nigerian economy, is still critically dependent on the products and services that are generated by or from the natural environment. A majority of the poorest Africans depend directly on the Earth’s renewable and non-renewable natural resources for their survival. Several resource-based conflicts and wars have or are taking place in Africa, such as in Angola, Democratic Republic of Congo, Liberia, Sierra Leone, Sudan, Zimbabwe, Nigeria, and Ivory Coast. Hence, adequate knowledge of and carefully-planned socio-economic and environmental development, poverty reduction and sustainable use of natural resources endowment is fundamental to Africa’s long-term stability. There is an urgent need, therefore, to be aware of the nature and uses of resources, and compile inventories, audits and digital databases for nations’ natural, geological and environmental resources (minerals, forestry, water, wildlife, soil and tourism). These could then be used to build capacity, review old strategies and devise new workable strategies for ensuring sustainable development using the natural resources entrusted to man by God. The databases, audits and inventories would also provide invaluable baseline data. By virtue of being the absolute Creator, God’s claim on the universe and everything therein is absolute. Everything ultimately belongs to Him and to Him alone (Psalms 50:10-12). Of course, in His wisdom, God gave humanity dominion over the Earth (Gen. 1:26-28), thus entrusting His Earth to humans. In so entrusting them, God appointed them stewards over creation. From this fact, however, several consequences follow. First, since everything ultimately belongs to God, whatever one possesses– and thus owns– comes as a trust from Him. For this reason, man’s right of ownership is never absolute– one’s property always belongs first and foremost to God Himself. Secondly, since it comes as a trust from God alone, He holds those to whom He has entrusted wealth/resources responsible for giving to His work (Num. 18:20-32; Deut. 14:28-29; Mal. 3:8-10; 2 Cor. 9:6-14; 1 Tim. 5:18) and for caring for the poor and vulnerable among them (Prov. 29:7; Amos 5:11-12; Matt. 19:21; 1 Tim. 5:3-5). Nigeria is very well endowed with human and other natural resources and she must be aware of their natural resources endowments and ensure that these resources are used sustainably and fairly for maximum societal good and/or are conserved. In Nigeria, every one, the three tiers of Government, relevant Agencies (e.g. NEITI, Economic and Financial Crimes Commission (EFCC), Independent Corrupt Practices Commission (ICPC) and the other anti-corruption agencies) have a duty and responsibility in this regard. Under the Presidency, the Inter-Agency Task Team (IATT) of anti-corruption agencies has primary official responsibility. IATT is the coordinating forum of Agencies with anti-corruption and accountability mandates and has its Secretariat as the Technical Unit on Governance and Anti-Corruption Reforms (TUGAR). On Monday, 17th October 2011, TUGAR (Secretariat within NEITI) and IATT (in collaboration with the United Nations Development Programme (UNDP)) organized a one-day sensitization workshop in Abuja on national strategy to combat corruption for which synergy between agencies is required.

2.0. MINERALS INDUSTRY AND MINERAL EXTRACTION

2.1. Constitutional and Legal Provisions

The 1999 Constitution (under the Second Schedule, Section 4, item 39) vests exclusive powers and control of solid minerals as well as of mines, oil fields, oil mining, geological surveys and natural gas only on the Federal Government, and not on State/Local Governments or on individuals. The Minerals and Mining Act of 2007 also vests the Federal Government with similar powers under Section 1. The necessary legal right to admit or permit operators into the Nigerian oil and gas and the solid minerals industries is, therefore, vested on the Federal Government. This authority is exercised by the Department of Petroleum Resources (DPR) of the Ministry of Petroleum Resources for oil and gas and the Nigerian Mining Cadastre Office (NMCO) of the Ministry of Mines and Steel Development (MMSD) for solid minerals, including the energy resources of coal, uranium and bitumen. Up to 10,000 new solid minerals mining licences and leases were approved or renewed by NMCO by mid-2011. In order to carry out oil production or mining legally, the individual, group or company must, therefore, be formally admitted into the industry or be registered and later licensed by the Federal Government for the particular mineral and land area/oil block of interest. Alternatively, an existing registered and already admitted mining company (which has legal title to the relevant leases and permits) may be purchased by a new investor. In the past, these legal procedures were often subject to policy changes, long delays in processing, and often cumbersome and expensive procedures and were allegedly occasionally subject to corruption. The publication and follow-up action on past NEITI Audits have significantly improved transparency in the oil and gas sector and data contained in the forthcoming solid minerals sector audits may also reduce corruption and illegal mining and marketing and improve data and governance. In the solid minerals sub-sector, recent Government action, such as the set up of the NMCO, and the new 2011 Mining Regulations and other measures significantly increased transparency and due process in the sector. There is, however, still room for improvement that would enable the many labour-intensive small-scale and artisanal operators (who tended to mine illegally) to legalize their operations and form small-scale mining cooperatives which are now actively encouraged and supported by (MMSD).

2.2. Nature and Organizations in Extractive Industry

Naturally occurring mineral resources must first be found through exploration (which is usually based on knowledge of their mode of formation and occurrence and their typical association due to their physical and chemical properties) before they can be extracted. It is usually necessary to carefully organize exploration programmes by selecting appropriate geological, geophysical, structural, geochemical, remote sensing and integrated methods before applying relevant scientific and technical knowledge to the specific exploration challenges faced. The extractive industry has a number of unique characteristics and it differs significantly from commercial activities. It involves several risks-technical, economic, political, financial and environmental, and mining usually has a long lead time or gestation period after geological occurrence. Some relevant technical Departments of MMSD are Mines Inspectorate (MID), Mines Environmental Compliance (MECD), and Artisanal and Small-Scale Mining (ASMD). Two relevant key MMSD Agencies are the Nigerian Geological Survey Agency (NGSA) and the Nigerian Mining Cadastre Office (NMCO), Briefly, NMCO is responsible for receiving, processing and disposing of applications for the transfer, renewal, modification and relinquishment of mineral titles or extension of areas; and maintaining a chronological record of all applications for mineral titles in a transparent, first-come first-served basis (just as for the Department of Petroleum Resources-DPR- for oil and gas). The Nigerian Geological Survey Agency (NGSA) is responsible for producing geological and other related maps. NGSA currently hosts free monthly public interaction in State capitals. Maps (topographic, geological, mineral, structural, mines priority maps) produced by extractive industry professionals are very useful to society, including sister professionals in the construction industry (engineers, architects, builders, town planners, etc.), especially on the location and routing of major engineering structures (dams, highways, airports and buildings) and provision of constructional and structural materials. Hence, much greater professional and geological input and multi-disciplinary collaboration between different professionals would significantly reduce the cost and failure of, and improve the safety and longevity of major engineering structures. MID’s responsibilities include supervision of reconnaissance, exploration and mining operations; enforcement of all health and safety regulations, as approved by law at mine sites, and conducting inspections and investigations necessary for ensuring compliance with regulations. MECD is responsible for reviewing all plans, studies and reports required from mineral title holders in respect of their environmental obligations; monitoring and enforcing compliance by mineral title holders with applicable environmental requirements and obligations, and performing periodic environmental audits to ascertain that regulations and obligations are met by title holders. Similar regulatory agencies in for the oil sector in the Ministry of Petroleum Resources include the Department of Petroleum Resources (DPR), the National Environmental Standards Regulatory and Enforcement Agency (NESREA) and the National Oil Spill Detection and Regulatory Agency (NOSDRA) (Table 5).

2.3. Socio-economic and Environmental Consequences of Resource Extraction

Non-renewable resources may be depleted/exhausted because they are formed much more slowly (in terms of millions of years) than they can be extracted and used (in days or years). They, thus, need to be conserved, used judiciously, recycled, and/or the more abundant alternatives or substitutes are used first. EI resources are, therefore, a national or humanity’s patrimony that should be used as sustainably as possible and bequeathed to future generations. Resource extraction has several positive and negative social and environmental impacts. Positive impacts include creation of jobs, provision of basic raw materials and commodities for trade; creation of a number of linkage effects (such as backward, forward and final demand linkages); the opening up of remote, resource-rich rural areas; the earning, saving and stabilization of foreign currency earnings; the development of technology and skills locally, etc. In the past, tin and columbite (largely from Plateau State) and coal (from Enugu State) contributed significantly to the national economy and the development of cities (e.g. Jos and Enugu), and the provision of infrastructures, such as roads, electricity, schools, hospitals and the railways. Negative social and environmental impacts, however, exist and these include resource depletion, introduction of alien cultures, and spread of communicable diseases; noise and dust pollution, spread of toxic and radioactive trace elements, and pollution of nearby water, land, and forest resources. Before any new major mining and other development project starts, it is, thus, obligatory under the Environmental Impact Assessment (EIA) Act no 86 of 1992 that an environmental (with social) impact assessment (EIA) study be carried out to predict expected environmental (and social) consequences, propose remedial measures, and alternatives/options. For the solid minerals, MMSD (with World Bank loan) has carried out extensive environmental audits on past mining activities, capacity building, inventories and upgrade of solid mineral data.

2.4. Origin of Metallic Ores, Oil and Gas

Natural processes identical with the three processes resulting in the rock cycle also form ore (metallic) deposits as well as the non-metallic industrial minerals, rocks, oil and gas. These processes are the igneous (high temperature and pressure melting of rocks); metamorphic (rocks changed by temperature, pressure and presence of fluids); and sedimentary processes (new rocks formed by weathering, transportation and deposition of preexisting ones). Oil and gas (petroleum), for example, form from ancient marine organisms (especially planktons) that collected on the sea bed and mixed with muddy sediments in stagnant conditions. Over long periods of up to 20 million years, bacteria partially broke them down as the bacteria used up the oxygen in the decayed matter, leaving behind an organic sludge (kerogen) which, when sufficiently thickened and compressed, forms petroleum (oil and gas). Five key factors (source, reservoir, and cap rocks, traps and/or structures, and pressure-temperature-time regimes) are critical factors for oil and gas formation. On-shore and offshore Niger Delta is a very important petroleum province with proved reserves of about 36.2 billion barrels of oil and gas reserves in excess of 187-600 trillion standard cubic feet (tscf) of associated and non-associated gas. The geology and geological history of the Benue Trough, Chad, Middle Niger, Benin-Dahomey, Sokoto and Anambra Basins and the results of oil well drilling in the 1950s, 1960s and the 1999-2000 period indicate that there may be reasonable prospects for finding some new oil and gas in some of these Nigerian inland/frontier sedimentary basins. Such prospects can only be properly evaluated after detailed, integrated, and well-funded multi-disciplinary studies. Such studies should involve all major stakeholders, including the on-going Petroleum Technology Development Fund (PTDF) Chair research at the University of Jos. Based on the knowledge of the age, rock composition, characteristics, structure and history of underlying or host rocks, geoscientists and related disciplines can predict the likely associated EI resources. Nigeria at or below the Earth’s land surface and continental shelf is blessed with a wide variety of mineral resources, occurrences and deposits. Over 500 occurrences/deposits are so far known in Nigeria land area. Many, such as manganese nodules, may exist in the exclusive economic zone (EEZ) off Nigeria’s coast. In 2006, the then Ministry of Solid Minerals Development (MSMD) (now called Ministry of Mines and Steel Development (MMSD)) adopted running a 34-brand initiative, tagged “34 Minerals” to promote these 34 major types of out of several other solid minerals and rocks. For greater emphasis, eight “strategic minerals” were chosen (Table 6). 

2.5. Geology of Nigeria

From the origin of petroleum and ores discussed above, it is clear that mineral resources can only occur in rocks of appropriate origin, history, age and environment of formation. For example, oil and gas can only occur in rocks of the Sedimentary Series, one of the three major rock groups in Nigeria. They are often referred to as Sedimentary Basins. (The two other groups are the largely Precambrian (540-4,600my old) igneous and metamorphic rocks of the Basement Complex and the Mesozoic alkaline igneous rocks of the Younger Granites). Sedimentary Basins cover about 50% of Nigeria’s total surface area of about 924000km2. Known mineral resources in these Sedimentary Basins include oil and gas, coal, brine, limestone, clays, barite, lead, zinc, gypsum and sand (e.g. Table 4 for the Benue Trough). There is increasing interest by NNPC, oil majors and the New Nigeria Development Company (NNDC) in the oil and gas prospects of inland sedimentary basins, especially after the discovery of hydrocarbons in many other inland sedimentary basins in Africa (e.g. in Cameroun, Central African Republic, Chad, Niger and Sudan) and elsewhere worldwide. In order to assess the petroleum, solid mineral and environmental resources potential of the basins, integrated programmes involving basic but extensive geological, stratigraphic, geochemical and sedimentological sampling and studies are required to assess the existence, quantity and quality of suitable source, reservoir and cap rocks, traps/structures, and pressure-temperature-time regimes. Careful evaluation of the geology and geological history of the inland sedimentary basins as well as the oil well drilling in the 1950s, 1960s and the 1999-2000 period indicate that there are reasonable prospects for finding some oil and gas in some of the inland or frontier sedimentary basins. Also, from Nigeria’s varied geology and large surface area, there are excellent prospects for finding many more solid minerals as well as oil and gas in geologically favourable areas in Nigeria (Tables 4 and 6). All stakeholders, including all tiers of Governments, communities and individuals, should note this fact and collaborate with relevant EI companies ensure sustainable development.

3.0. ENVIRONMENTAL AND SOCIAL IMPACT ASSESSMENT (ESIA)

The dynamic Earth system can be studied using interactions between geology, biology, chemistry and physics. Together, they define the conditions on the Earth and how these may be influenced by human activities. Knowledge of and use of geology play important roles in understanding the nature, quality and quantity of natural resources as well as on crops, trees and water resources management which are very dependent on the nature of the underlying soils, minerals and rocks. Geology, thus, has substantial impacts on quality of life. Many natural resources could be assessed and monitored using data from satellite remote sensing and geographic information system (GIS) techniques. Preliminary baseline data collected on the biological, physical and chemical environmental for an EIA can also be obtained from satellite remote sensing data. The purpose of the EIA is to ensure that decision-makers consider all likely environmental impacts before deciding whether to proceed with new projects. EIA studies are usually presented at public hearings and displayed for 21 working days at relevant Local Government Headquarters, State Capitals and Offices of the Federal Ministry of Environment. Aspects studied identify, evaluate and predict the Project’s positive and negative impacts on the physical, chemical, biological, hydrological and social environments, including the socio-economic impacts and the direct environmental impacts of projects, develop control strategies with a view to mitigating and ameliorating significant impacts. Finally, EIAs must recommend Environmental Management Plans (EMPs) that contain the environmental objectives and commitments, how these may be achieved, the responsibilities/accountabilities, corrective actions to be employed should the need arise, and review schedules and criteria. More recently, many oil companies signed memoranda of understanding (MOUs) and global memorandum of understanding (GMOUs) with host communities. In the solid minerals industry, the 2007 Minerals and Mines Act stipulate similar but legally binding environmental measures, including community development agreements (CDAs) between operators and host communities.

 4.0. EXTRACTIVE INDUSTRIES MANAGEMENT

With a current reserve of about 36.2 billion barrels of crude oil and associated and non-associated gas estimates ranging from 187 to 600 trillion standard cubic feet (tscf), Nigeria could remain a major player in oil and gas and remain as Africa’s leading oil producer. Potentially, she has about the 4th to 6th largest gas reserve in the world and, if the tempo of exploration offshore and onshore (especially in inland/frontier sedimentary basins) is significantly increased, reserves would increase to 40 billion barrels to enable her produce at about 4 million barrels per day. In terms of crude oil reserve, Nigeria ranks about 10th while with respect to production, she ranks about 11th in the world (Table 7). In Africa, Nigeria ranks second after Libya in reserve, but she is the largest producer at about 2.5 million barrels per day. Compared with Libya (which has a reserve life of 66 years), Nigeria has a reserve life of only 41 years (Table 7). Ten countries have larger crude oil reserve lives, which range from about 46 to 150 years. It is, thus, imperative that Nigeria must vigorously explore to increase her reserve and reserve life. Exploring the inland or frontier sedimentary basins is one strategy. This also make strategic, security and socio-economic sense since discovery would lead to greater diversification of production centres from the Niger Delta. It would also facilitate viability of inland oil refineries and even development. Even the discovery of natural gas would be a bonus as natural gas is the fuel of choice in many countries and a vital component of the world’s energy mix. After renewable energy, natural gas is one of the cleanest, safest, cheapest and most useful of all energy sources. In addition to being an energy source, gas is also a useful feedstock in the fertilizer and other industries. It may even take over from crude oil at and after the so-called “peak oil”. Gas extraction would lead to job creation, production of raw materials and commodities for trade, and significant revenue for development, if well-managed. Nigeria has learned from several other oil producing countries, such as Algeria, Norway, Saudi Arabia, Kuwait, Qatar, Russia and the United Arab Emirates (UAE) that had earlier on established special savings from “windfall” price rises, called “Sovereign Wealth Funds” (SWFs). These are invested in stocks, bonds, property, among other securities, worldwide rather than being shared as so-called “Excess Crude Account” and squandered, as is currently the case in Nigeria. SWFs yield interests and can provide for future generations (national patrimony) and protect national economies from excessive public spending, currency stability and inflation. Over the 50-year period from her first oil production to 2006, Nigeria had discovered about 60billion barrels and produced about 27billion barrels (45% of discovery) earning a total revenue of about $400billion US dollars! Since the 1970s, this largely transformed the Nigerian economy from a largely solid minerals and agricultural products-based economy to a petroleum rent-seeking one. Less than 5% of Nigerian adult population is involved in generating about 90% of total export earnings from oil- a very low per capita productivity. Solid minerals extraction is, however, less capital- and technology-intensive, but is more labour-intensive. The remaining 95% of Nigerians are involved in the distribution of the wealth or queue up to receive a slice of the “cake” baked by <5%. The result of this oil-based economy without good governance is high unemployment, widespread corruption, frustration and political and economic instability in the absence of consistent, honest and disciplined leadership and followership that could turn the rent generated into a catalyst for economic growth, as is currently the situation in Nigeria. This large petroleum rent has been shared and squandered. Fortunately, geological factors indicate there is still potential to discover at least additional 40billion barrels of oil, at least 120tscf of associated gas and more non-associated gas. Recent passage of the SWF Act in Nigeria is encouraging and, like other oil-producing nations, SWFs (also initially called National Petroleum Fund and later Government Pension Fund in Norway) capture dedicated portions of earnings from oil and gas revenue and ploughed annually as insurance for future generations because mineral (including oil) resources are a national patrimony. This is especially significant for Nigeria since from Table 4, of all the OPEC countries, Nigeria has the lowest reserve life of about 41 years, while Kuwait (which also operates a SWF) has a reserve life of about 110 years (Table 7). In addition to investment in infrastructure, oil rent should also be applied to the development of other extractive industries sub-sectors, such as sustainable agriculture, solid minerals and forestry resources. With the establishment of a SWF, future generations of Nigerians should enjoy the benefits of present-day oil production. Conservation of earnings and the natural resources, significant reserve addition through exploration, greater environmental and social responsibility of producers as well as greater local content development (as in the original Petroleum Industry Bill-PIB) are also recommended. This would ensure that the 50+ years of squandered Nigerian oil heritage is urgently reversed. The Niger Delta amnesty programme should also be improved upon and be fully implemented to enhance sustainability and political stability, especially in the oil-producing Niger Delta.

On strategies for sustainable development of mineral resources Government (especially the Ministry of Mines and Steel Development) and the World Bank are congratulated for providing more reliable basic geo-scientific basic data, executing inventories and basic mineral exploration, and developing indigenous manpower. There is still need for adequate and sustained funding, appreciating professionals’ role, providing facilities and continuous training. In developing natural resources, basic understanding of the complex technical, legal, socio-economic, environmental, conservation and other issues (through sensitization) and of the related phases (e.g. in the mineral industry system (MIS): exploration, evaluation, development, exploitation or production, processing, marketing, use, depletion, and impacts) are required by operators and all stakeholders must be fully involved in all stages/phases. Apart from its technical complexity and risks, the MIS often also has a long gestation period, unlike many commercial activities and services usually preferred by banks, lenders and entrepreneurs. Governments and stakeholders must appreciate the associated risks and be prepared to compensate those who take risks in these productive enterprises beneficial to investors and society. A more stable policy and regulatory framework and Government support for small-scale operators, such as the artisanal and small-scale miners and the marginal (oil) field operators need to be sustained. Banks should also be adequately enlightened and supported to accept professional qualifications, leases and professionally executed technical studies that meet international standards (e.g. the Joint Ore Reserve Committee-JORC) as collateral for loans for financing/marketing extractive industries projects. Government agencies (e.g. Nigerian Geological Survey Agency (NGSA), Raw Materials Research and Development Council (RMRDC), NMCO, and NEITI) should regularly sensitize/educate stakeholders on the locations, quality, quantities and industrial uses of EI resources, as is being done in this NEITI Conference. NGSA has regular monthly sensitization clinics at Zonal/State offices nationwide (Table 5).  

5.0. MANAGEMENT STRATEGIES FOR EXTRACTIVE INDUSTRIES

As part of her management strategies for the extractive industries, Nigeria, hence, ought to:

  1. Adequately regulate and ensure law and order & a conducive environment;
  2. Provide relevant workable and world-class policies, laws, regulations, codes, etc;
  3. Ensure policies are implemented and laws and regulations are fully enforced;
  4. Ensure Agencies are well-manned, equipped, financed and monitored;
  5. Ensure Agencies focus on capacity building and providing accurate data and enabling environment for planning and private-sector exploration;
  6. Focus on certain minerals/commodities at a time, such as 8 “strategic” minerals;
  7. Ensure that Agencies are accountable & regularly sensitize stakeholders on roles;
  8. Government (Executive, Legislature & Judiciary) must enact and enforce laws;
  9. Update existing enabling Acts and pass new ones (e.g. Petroleum Industry Bill);
  10. Fully implement all Acts, such as the Nigerian Sovereign Wealth Fund Act 2011.
  11. Regularly audit all EI resources (including environmental & social impacts);
  12. Explore and sustainably manage EI resources & the environment as a patrimony.

In general, the formulation of policies and the enactment of laws is usually not a problem in Nigeria. The major challenges usually involve enforcement/implementation and independent monitoring and evaluation. Again, often, there is no credible or independent monitoring and evaluation, a responsibility which the press, civil society and credible unions and the academia can not carry out alone. Through NEITI Audits, such challenges/constraints are being tackled. The Petroleum Industry Bill (PIB) has been stalled for years since about 2008 in the National Assembly and the final version may be allegedly significantly distorted. The Sovereign Wealth Fund Act is facing stiff opposition from some State Governors and other interest groups. They are apparently insisting that Nigeria should spend all she earns (and even borrow) without saving for the rainy day, future generations and developing critical national infrastructure! All must appreciate that most EI resources are wasting/depleting assets, which unless explored and developed, would get one day! Nearly forty (40) developed, emerging and developing countries (Abu Dhabi, Algeria, Australia, Azerbaijan, Bahrain, Botswana, Brazil, Brunei, Canada, Chile, China, France, Hong Kong, Indonesia, Iran, Ireland, Kazakhstan, Kiribati, Kuwait, Libya, Malaysia, Mauritania, (New?) Mexico, New Zealand, Nigeria, Norway, Oman, Qatar, Russia, Saudi Arabia, Singapore, South Korea, Timor Leste, Trinidad and Tobago, United Arab Emirates, United States, Venezuela, and Vietnam) are currently implementing one form of sovereign wealth fund (SWF) management or the other (Table 9). In spite of some size and technical differences with the oil and gas sub-sector, extension of audits to the medium- and larger-scale operators in the solid minerals sub-sector would significantly promote transparency, reduce illegal operations and smuggling, increase non-oil revenue and improve safety, health and environmental clean-up (SHE) issues, especially with the recent death of about 400 children in Zamfara State due to exposure to lead dust during crushing of gold-bearing ore at home or at the mines. Adults have also reportedly suffered from high rates of infertility and miscarriages.

SELECTED BIBLIOGRAPHY

Federal Republic of Nigeria. 2011. Nigeria Extractive industries Transparency Initiative (NEITI). NEITI Secretariat. Scoping Study on the Nigerian Mining Sector (Trust Fund No. 95381; Project No P114267 of 5th September 2011). Report for NEITI Stakeholder Workshop 22nd September 2011. Prepared by Geological Survey of Denmark and Greenland, GEUS, Bureau of Minerals & Petroleum (Greenland), Minre Associates & Meyetty Nigeria. 91pp.

Nigerian Extractive Industries Transparency Initiative Act 2007. 13pp.

Nigeria Extractive Industries Initiative (NEITI). Undated. Glossary of Extractive Industry Terms. NEITI, Abuja, Nigeria. 49pp.

Nigeria Extractive Industries Initiative (NEITI). 2011. NEITI Handbook. NEITI Secretariat.

Ogezi, A.E. 2005. Safety, health and environment (SHE) in a mining region-Plateau State case study. The Crust. Newsletter of Nigerian Mining & Geosciences Society. Vol. 27, no 1, p.18-23.Ogezi, A.E. 2008. Geology, Time, Resources, Environment and Man. University of Jos Inaugural Lecture Series Number 37, April 2008. Jos University Press Ltd. Jos. 122pp.

Ogezi, A.E. 2011. Basic and peculiar field techniques and procedures used for the geological mapping and investigation of mineral resources potential: Benue Trough case study. Manuscript submitted for publication by Petroleum Technology Development Journal, Abuja, Nigeria.

Table 1: Extractive Industries Transparency Initiative (EITI) Country Group that reflects progress with EITI Reporting and Validation (After EITI Rules, 2011 Edition).

Group

Status

Countries

1

Compliant

Azerbaijan, Central African Republic, Ghana, Kyrgyzstan, Liberia, Mongolia, Niger, Nigeria, Norway, Timor-Leste.

2

Candidate

“Close to compliant”

Cameroon, Democratic Republic of Congo (Zaire), Gabon, Kazakhstan, Mali, Mauritania, Peru.

3

Candidate“Meaningful progress”

Congo, Mozambique, Sierra Leone, Tanzania, Zambia.

4

Candidate: 2011

Validation deadlines.

Albania, Burkina Faso, Madagascar

5

Candidate: 2012/2013

Validation deadlines.

Afghanistan, Chad, Guatemala, Guinea, Indonesia, Iraq, Togo, Trinidad and Tobago.

6

Others

Cote d’Ivoire, Yemen.

Table 2: Similarities and differences between Nigerian oil & gas and solid minerals sectors.

                                                            Similarities

Both groups of natural physical resources are produced/extracted from Earth in similar ways.

Both resources groups formed in similar geologically slow long periods up to millions of years.

Hence, similar techniques are used in their search and extraction by similar EI professionals.

Both groups are exhaustible/depletable natural resources produced much faster than formed.

Search for, exploitation, use and waste disposal have major social and environmental impacts.

Impacts similar and may be positive (jobs, technology, revenue, etc) or negative (pollution).

For both sectors, further exploration may lead to increase in reserves even with production on.

                                                            Differences

Oil and gas of organic origin and being liquid and gas respectively move faster (pollution faster).

Solid minerals largely inorganic (except coal & bitumen) and as solids, they move more slowly.

Oil and gas extracted in only nine (9) southern States, but solid minerals in 36 States and Abuja.

Sub-surface extraction of solid minerals cause land-use greater conflicts and soil sterilization.

Solid minerals provide greater range of raw materials and employ far more artisans/individuals.

Hence, solid minerals sector leads to greater poverty reduction and less technology-intensive.

Most companies in solid minerals sector (SMS) are artisanal and small-scale; none large scale.

Largest companies are cement manufacturers and construction companies operating quarries.

Compared with oil and gas, revenues relatively small and only 19 companies paid > N0.5m/yr.

Table 3: Creation of Wealth (source unknown).

Wealth has to be produced out of Nature

From tilling the land or mining minerals or felling trees

Or (from) turning raw materials into finished products for human consumption”.

Table 4. Major mineral and energy resources of the Benue Trough: major locations, structural, lithological and other controls (After Ogezi, 2011 in PTDF Journal).

Serial no

Resource

Major Locations

Major  Controls

 

1

Barite (Barytes)

Azara, Dumgel, Faya, Gabu, Ibi, Karim Lamido, Muri,

Fissure-filling in granites and various sedimentary rocks (limestone, mudstone, shale, sandstone, siltstone.

 

2

Clays

Very widespread in the Benue Trough

In formations dominated by shales.

 

3

Coal

In more than 10 States within Trough: Afikpo, Doho, Enugu, Gombe, Lamja, Garin Maiganaga, Okaba, Ogboyaga, Owukpa, Lafia-Obi, Shankodi, etc.

Largely restricted to so-called “Coal Measures” (Mamu & Awgu Formations, etc) deposited in humic and deltaic environments. Many seams highly faulted.

 

4

Constructional Materials

Widespread in present and ancient channels and igneous bodies.

Alluvials, indurated sedimentary rocks, volcanic, pyroclastic rocks and intrusives.

 

5

Dilute brine

Abakaliki, Awe, Azara, Gabu, Keana, Moi-Igbo, Uburu.

Associated with barites, fluorite and igneous bodies? and lineaments.

 

6

Fluorspar

Agila, Akwana-Arufu, Faya.

Associated with barites, dilute brine, igneous bodies and lineaments.

 

7

Gypsum

Widespread in Adamawa, Bauchi, Benue, Enugu, Gombe, and Yobe.

Largely restricted to shaley and calcerous formations. Unlikely of evaporate origin.

 

8

Lead & Zinc Ores

Akwana, Ameka, Ameri, Arufu, Azara, Diji, Enyigba, Gidan Dari, Isamiya, Ishiagu, Wase & Zurak.

North-south trending quartz veins in limestone, sandstones and shales with siltstones; also rare lodes and fracture-filling. Near volcanic/ pyroclastic rocks.

 

9

Limestone

Widespread in all 16 States of Trough.

Shallow marine, associated with shales.

 

10

Oil and gas (?)

None known; 3 oil wells in UBT and >40 in LBT and Anambra Basin. No oil wells in Middle Benue Trough. Good prospects.

Suitable source and reservoir rocks, structures and traps. Major fields in related African basins. Coal, a potential oil and gas source, is widespread in Trough (see item 3).

Table 5: Major Technical Departments and Parastatals of some Ministries, Departments and Agencies (MDAs) with extractive industry-related legislation, guidelines, standards, regulations and professional interest.

  1. 1.      Ministry of Mines and Steel Development (MMSD)

Nigerian Mining Cadastre Office: 37 Lobito Cr, Off Ademola Adetokumbo Cr, Wuse II.

Nigerian Geological Survey Agency: 31 Shettima Munguno Cr, Behind J. Berger, Utako.

Mines Environmental Compliance (MECD)

Artisanal and Small Scale Mining (ASMD)

Mines Inspectorate (MID)

Council of Nigerian Mining Engineers and Geoscientists (COMEG): a regulatory body.

National Institute of Mining and Geosciences (NIMG), Jos: for postgraduate training.

Planning, Research and Statistics (PR&S).

  1. 2.      Ministry of Petroleum Resources

Nigerian National Petroleum Corporation (NNPC) & its up- & down-stream subsidiaries (e.g. NPDC, NAPIMS, IDSL, etc). Petroleum Industry Bill not yet passed since 2008).

Petroleum Technology Development (PTDF):  largely EI capacity building & research.

Department of Petroleum Resources (DPR)

  1. 3.      Federal Ministry of Water Resources
  2. 4.      Federal Ministry of Environment

National Environmental Standards Regulatory and Enforcement Agency (NESREA), etc.

National Oil Spill Detection and Response Agency (NOSDRA): specific for oil pollution.

  1. 5.      Federal Ministry of Agriculture
  2. 6.      Major Extractive Industries Professional Associations

Nigerian Mining and Geosciences Society (NMGS)- Head Office at Zawan, near Jos.

Nigerian Society of Mining Engineers (NSME)- Head Office at Bukuru, near Jos.

Nigerian Association of Petroleum Explorationists (NAPE), Head Office, Lekki, Lagos.

Society of Petroleum Engineers (SPE), Nigeria Chapter. Head Office in Lagos/P.H.

Nigerian Association of Hydrogeologists (NAH).

Table 6: Types and locations of some Nigerian solid minerals- MMSD 34 Brand Minerals

1. Barytes (Barite): Benue, Cross River, Nasarawa, Plateau, Taraba and Zamfara States.

2. Bentonite (Clay): Borno, Edo, Kogi, Ogun and Ondo States.

3. Bismuth Minerals: Kaduna State.

4. Bitumen and Tar Sand: Edo, Lagos, Ogun and Ondo States.

5. Cassiterite: Bauchi, Cross River, Kaduna, Kano, Kogi, Nasarawa, and Plateau States.

6. Clays, Sand and Gravel: All 36 States of Nigeria, including Abuja Federal Capital Territory.

7. Coal: Abia, Adamawa, Anambra, Bauchi, Benue, Cross River, Delta, Ebonyi, Edo, Enugu, Gombe, Imo, Kogi, and Nasarawa States.

8. Columbite: Bauchi, Cross River, Kaduna, Kano, Kwara, Nasarawa & Plateau States & Abuja.

9. Diatomite: Yobe State.

10. Feldspar: Bauchi, Borno, Kaduna and Kogi States and Abuja Federal Capital Territory.

11. Fluorite (Fluorspar): Bauchi, Ebonyi, Plateau and Taraba States.

12. Gemstones: Bauchi, Kaduna, Kogi, Kwara, Nasarawa, Niger, Plateau, Ogun, Oyo & Taraba.

13. Gold: Abuja FCT, Kaduna, Kano, Katsina, Kebbi, Kogi, Kwara, Niger, Oshun & Zamfara.

14. Gypsum: Adamawa, Benue, Edo, Gombe, Ogun, Sokoto and Yobe States.

15. Ilmenite:  Bauchi, Cross River, Kaduna and Plateau States.

16. Iron Ores: Bauchi, Enugu, Kaduna, Kogi, Nasarawa and Zamfara States and Abuja FCT.

17. Kaolin (Clay): Anambra, Akwa Ibom, Bauchi, Ekiti, Imo, Katsina, Kebbi, Kogi, Ogun, Ondo, Plateau and Rivers States.

18. Lead Ore: Bauchi, Cross River, Ebonyi, Nasarawa, Plateau, Taraba, Zamfara & Abuja FCT.  

19. Limestone: Abia, Adamawa, Benue, Cross River, Ebonyi, Edo, Gombe, Kogi, Nasarawa, Ogun, Sokoto, Taraba & Yobe States.

20. Lithium Minerals: Kaduna, Nasarawa, Niger and Zamfara States.

21. Kyanite: Kaduna and Niger States.

22. Magnesite: Adamawa and Zamfara States.

23. Manganese Minerals: Katsina, Kebbi and Zamfara States.

24. Marble: Edo, Kogi, Kwara, Nasarawa, Niger and Oyo States and Abuja FCT.

25. Mica: Ekiti, Kogi, Kwara, Nasarawa and Oyo States.

26. Molybdenite: Plateau State.

27. Phosphates: Imo, Ogun and Sokoto States.

28. Rutile: Bauchi, Cross River, Kaduna and Plateau States.

29. Silica Sand: Delta, Jigawa, Kano, Lagos, Nasarawa and Ondo States.

30. Silver: Ebonyi, Kano, Plateau and Taraba States (associated with lead-zinc ores).

31. Talc: Ekiti, Kaduna, Kogi and Niger States.

32. Tantalite: Bauchi, Cross River, Ekiti, Kaduna, Kano, Kogi, Kwara, Nasarawa, Niger, Osun and Plateau States.

33. Wolframite: Bauchi, Kaduna, Kano, Kwara, Nasarawa, Niger and Zamfara States.

34. Zinc Ore: Cross River, Ebonyi, Kano, Plateau, Taraba and Zamfara States and Abuja FCT. 

(Oil & Gas: Abia, Akwa Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo and Rivers States). Exploration going on in Inland/Frontier Sedimentary Basins: Niger/Nupe/Bida, Benue, Anambra, Sokoto/Illummedden, Borno/Chad, Benin-Dahomey Basins. More data exist on the Anambra & Borno/Chad Basins due to the 1950s and 1960s oil company and more recent NNPC exploration. (Note that similar inland sedimentary basins in West and Central Africa (Cameroun, Central African Republic, Chad, Niger, Sudan & Uganda) have oil and gas shows and fields (e.g. Ogezi, 2011). Prospects in some of Nigerian basins are, therefore, good. Detailed exploration and drilling are required to confirm or refute). (Unquantified uranium occurrences exist in Adamawa, Borno, Gombe, Katsina, Plateau & Sokoto States). 

Table 7: Petroleum reserves, production and reserve lives data for some countries in 2008 (After Wikipedia, October, 2009).

Country

Reserve

Reserves

Production

Production

Reserve Life

 

109 bb

109m3

106 bbl/d

103m3/d

Years

Saudi Arabia

267

42.4

10.2

1,620

72

Canada

179

28.5

3.3

520

149

Iran

138

21.9

4.0

640

95

Iraq

115

18.3

2.1

330

150

Kuwait

104

16.5

2.6

410

110

United Arab Emirates

98

15.6

2.9

460

93

Venezuela

87

13.8

2.7

430

88

Russia

60

9.5

9.9

1570

17

Libya

41

6.5

1.7

270

66

NIGERIA

36

5.7

2.4

380

41

Kazakhstan

30

4.8

1.4

220

59

United States

21

3.3

7.5

1,190

8

China

16

2.5

3.9

620

11

Qatar

15

2.4

0.9

140

46

Algeria

12

1.9

2.2

350

15

Brazil

12

1.9

2.3

370

14

Mexico

12

1.9

3.5

560

9

TOTAL FOR TOP 17

1243

197.6

63.5

10,100

54

Notes   1: Reserve life is reserve to production ratio (in years) calculated as reserves/annual production. 2. Angola is a major African oil producer with about million barrels per day.

Table 8: Developed, emerging & developing countries operating Sovereign Wealth Fund.

Abu Dhabi, Algeria, Australia, Azerbaijan, Bahrain, Botswana, Brazil, Brunei, Canada, Chile, China, France, Hong Kong, Indonesia, Iran, Ireland, Kazakhstan, Kiribati, Kuwait, Libya, Malaysia, Mauritania, (New?) Mexico, New Zealand, Nigeria, Norway,  Oman, Qatar, Russia, Saudi Arabia, Singapore, South Korea, Timor Leste, Trinidad and Tobago, United Arab Emirates, United States, Venezuela, and Vietnam.

Table 9: Some recent major issues in the Nigerian extractive industry

Eight (8) “strategic minerals” (SM) declared by the Ministry of Mines & Steel Development for priority focus are barite (barytes), bitumen, coal, gold, iron ores, lead & zinc, and limestone. Tantalite was later added to the initial seven. SMs have potential for significant contribution.

Minerals and Mining (M&M) Act of 2007 and National Minerals and Metals Policy of 2008.

New MINING REGULATIONS based on the 2007 M&M Act was published in 2011.

NNPC-IDSL geological mapping & stratigraphic sampling of some inland basins started in 2011.

Nigerian Geological Survey Agency (NGSA) advertised tenders for border geological mapping.

The Petroleum Industry Bill still before the National Assembly long after submission in 2008.

NEITI carries out Scoping Study on the Nigerian Mining Sector & Workshop, September 2011.

National labour strike on fuel subsidy removal and Government sets up Committees/Task Force.

Where to find us?

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Phone Number
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