NEITI: Solid Minerals Revenue Surges by 52% to N193bn – Mining Firms Owe N1.06bn

NEITI: Solid Minerals Revenue Surges by 52% to N193bn – Mining Firms Owe N1.06bn
ads2

Solid Minerals Revenue

In a significant revelation, the Nigeria Extractive Industries Transparency Initiative (NEITI) has unveiled its 2021 Solid Minerals Industry Report, showcasing a remarkable 51.89 percent increase in revenue from the solid minerals sector. This surge saw the sector’s revenue climb to an impressive N193.59 billion in 2021, compared to the N116.82 billion recorded in the previous year, 2020. This financial audit report sheds light on the fascinating dynamics of Nigeria’s solid minerals sector and unveils some of the key contributors to this substantial growth.

The Pioneers of Growth

Solid Minerals Revenue

The NEITI report presents a star-studded list of contributors to this surge in solid minerals revenue, with industry giants such as Dangote, Bua, and Lafarge leading the way. These companies have not only propelled the sector to new heights but have also significantly impacted Nigeria’s economic landscape.

Unveiling the Financial Flow

Solid Minerals Revenue

According to NEITI’s 2021 Solid Minerals Industry Report, the audit encompassed a total of 1,214 companies. These entities collectively funneled a staggering N177.44 billion into the Federation Account. This figure underscores the sector’s growing significance within the Nigerian economy.

Revenue Breakdown

Solid Minerals Revenue

Delving deeper into the financial intricacies, the report reveals a breakdown of revenue contributions to the Federation Account. The Federal Inland Revenue Service (FIRS) emerged as the top contributor, generating a substantial N169.52 billion. Simultaneously, the Mining Cadastre Office (MCO) and Mining Inspectorate Department chipped in N4.3 billion and N3.62 billion, respectively.

A Decade of Growth

Solid Minerals Revenue

The NEITI report also provides insights into the sector’s long-term performance. Over the span of 2007 to 2021, government revenue from the solid minerals sector reached an impressive total of N814.59 billion, showcasing its consistent growth over the past decade.

Licensing Boom

Solid Minerals Revenue

One notable highlight of the report is the surge in mining licenses issued. In 2021, the sector recorded an 85 percent increase, with a total of 2,045 licenses granted compared to 1,482 in 2020. This surge reflects the growing interest and investment in Nigeria’s solid minerals sector.

Export Dominance

Solid Minerals Revenue

The international stage also comes into play as the report divulges data on the sector’s exports. In 2021, the sector exported a whopping 143,000 tons of solid minerals, with a total value of $101 million. China emerged as the dominant player, accounting for a staggering 95 percent of both export volume and value.

Solid Minerals in GDP

Solid Minerals Revenue

While the solid minerals sector’s growth is commendable, it still represents a relatively modest portion of Nigeria’s Gross Domestic Product (GDP). In 2021, it contributed 0.63 percent, equivalent to N1.10 trillion. This highlights the sector’s untapped potential for further contribution to the nation’s economic growth.

Government Revenue Share

Solid Minerals Revenue

In terms of government revenue, the solid minerals sector accounted for just 2.62 percent of the total government revenue of N6.63 trillion. This statistic underscores the need for further exploration of revenue-generating opportunities within the sector.

Production and Royalty

Solid Minerals Revenue

The NEITI report provides a comprehensive overview of production volumes and royalty payments. In 2021, a total of 76.28 million tons of solid minerals were used or sold, resulting in royalty payments of N3.57 billion. Notably, the minerals with the highest production volumes included Granite, Limestone, Laterite, Clay, and Sand. Dangote Plc took the lead in production, contributing 28.8 million tons, while Bua and Lafarge produced 8.4 million and 4.3 million tons, respectively. Zeberced also made a notable contribution with 3.3 million tons.

Regional Production

Solid Minerals Revenue

Geographically, the report unveils the distribution of production across states. Ogun State led the pack in 2021, recording a remarkable 17.5 million tons, followed closely by Kogi State with 16.3 million tons and Edo State with 8 million tons. In contrast, Borno State reported the lowest production volume at 25,500 tons.

NEITI’s Impact

Solid Minerals Revenue

Speaking at the report’s unveiling, Dr. Orji Ogbonnaya Orji, the Executive Secretary of NEITI, emphasized the significance of the audit findings. He noted that the report offered invaluable recommendations that could shape future policy decisions and enhance revenue growth if implemented effectively. Dr. Orji highlighted a concerning aspect of the findings, revealing that only 39 out of 121 companies fulfilled mandatory social payments outlined in the Community Development Agreements (CDAs) with their host communities. Additionally, 10 companies made only non-mandatory social payments, exposing a lapse in compliance with the Mining Act 2007 and NMMR 2011.

Government Commitment

Solid Minerals Revenue

The Secretary to the Government of the Federation, Senator George Akuma, who unveiled the report on behalf of the Federal Government, expressed satisfaction with NEITI’s performance over the years. He reiterated the government’s commitment to combatting corruption in the extractive industry and other sectors. Senator Akuma stressed the vital role that NEITI and similar reform-oriented agencies play in achieving economic revival.

Legislative Support

Solid Minerals Revenue

In a show of support, the Speaker of the House of Representatives, Rt. Hon. Tajudeen Abbas, pledged to prioritize NEITI’s audit reports in parliamentary debates. He emphasized the House’s determination to empower NEITI through legislative amendments, enabling the agency to uphold transparency and accountability in the extractive industry. The Speaker’s commitment aligns with the government’s aspirations for diversifying the economy, exploring alternative revenue sources, and promoting clean energy.

In conclusion, NEITI’s 2021 Solid Minerals Industry Report is a testament to the remarkable growth and potential of Nigeria’s solid minerals sector. With key industry players leading the charge, increased licensing, and a growing presence on the international stage, the sector is poised for further expansion. However, the report also underscores the need for improved compliance with social payments and a more substantial contribution to government revenue. As Nigeria continues its journey toward economic diversification, the solid minerals sector is undoubtedly a key player in shaping the nation’s financial landscape.

ads2
administrator

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *