The Federal Government have said oil and gas revenues in Nigeria have surpassed earnings from the solid minerals sector by a staggering $392.6 billion.
According to The Punch, the Nigeria Extractive Industries Transparency Initiative provided figures revealing that over a 10-year period, the oil and gas industry generated $394 billion, while the solid minerals sector generated a meager $1.4 billion in 13 years.
Both sectors are vital for revenue generation in Nigeria, given the country’s abundant natural resources. However, the vast disparity in earnings highlights the underperformance of the solid minerals sector. Recognizing this disparity, NEITI has outlined in its recently released Strategic Plan for 2022-2026 that it will shift its focus to the solid minerals sector.
NEITI emphasized that if the industry were opened up to investments, it could potentially contribute more than 60 per cent to the nation’s Gross Domestic Product. Currently, the solid minerals sector only contributes a paltry 1.8 per cent to the GDP.
Looking at the specific revenue figures, NEITI’s strategic plan showed that Nigeria earned N7.6 billion, N10.6 billion, N19.2 billion, N17.1 billion, and N27 billion from solid minerals in the years 2007, 2008, 2009, 2010, and 2011, respectively.
The data further revealed that in 2012, 2013, 2014, 2015, and 2016, the country generated N25.6 billion, N30.3 billion, N49.2 billion, N64.5 billion, and N43.2 billion, respectively, from the solid minerals sector.
The Nigeria Extractive Industries Transparency Initiative has expressed dissatisfaction with the underperformance of Nigeria’s solid minerals sector, despite its significant potential for revenue generation.
NEITI’s recent findings reveal that Nigeria earned N52.8 billion, N69.5 billion, N80 billion, and N128 billion from solid minerals in the years 2017, 2018, 2019, and 2020, respectively.
The Executive Secretary, NEITI, Ogbonnaya Orji, stated, while speaking on the agency’s new strategic plan, “We are very displeased that the solid minerals sector currently contributes a little over 1.8 per cent to Nigeria’s GDP. This is an enormous sector that can grow the economy more than oil.”
NEITI emphasizes that the solid minerals industry holds tremendous revenue-generating prospects. “Our projection is that if the solid mineral sector is thrown open for investment, that it has the potential to contribute over 60 per cent to the nation’s GDP. A 60 per cent in Nigeria’s GDP would mean outperforming oil.
“This is our target. We have done an extensive scoping study and seen the potential of the solid minerals sector. We have already identified six strategic minerals for focus, including gold and others. NEITI’s next major focus would be on the development of these strategic minerals.”
Having conducted 11 cycles of audits in the solid minerals sector from 2007 to 2020, NEITI has identified a total of N624.1 billion in revenue accrued to the government over the 13-year period.
However, this figure amounts to approximately $1.4 billion at the current exchange rate, significantly lower than the colossal $394 billion earned from the oil and gas sector in just 10 years.
According to Orji, this discrepancy underscores the neglect of the solid minerals sector’s vast potential. NEITI aims to promote transparency and accountability by encouraging disclosures of government payments related to solid minerals resources.
He also said, to address the sector’s challenges, the Federal Executive Council is currently developing a draft bill to amend the 2007 Mineral Act and create an environment conducive to increased investment in the solid minerals sector.
However, a deadlock persists between the federal and state governments regarding tax collection responsibilities.
In his words, “We hope that NEITI would be availed of the draft document to make an informed position as we did in the Petroleum Industry Bill. NEITI will be moving fully into the solid mineral sector to draw the same attention we drew to the oil and gas sector, drive reforms and ensure that revenues from the sector are prudently deployed for the growth and development of our country.”