The Vice President, Miners Association of Nigeria, Abuja, Alh. Musa Muhammed, a former Chairman, Kogi State Chapter, Miners Association of Nigeria speaks in an exclusive interview with NEWSDIARYONLINE correspondent.
He speaks extensively on issues affecting the Mining Industry in Nigeria and also gives detailed analysis on possible reforms that will redirect the trajectory of the industry on the part of rapid growth and development that will boost and strengthen the nation’s economy, and also guarantee drastic reduction of insecurity in the land. EXCERPTS:
By Chimezie Godfrey
Q: What is the state of the Mining Industry in Nigeria?
A: By the grace of God it is true that the stage of Nigerian mining industry right now is still at the baby level, sorry to use that word because you will find out most people involved in mining is what is known as artisanal miners, those who just go, look for anything they can get, they take to the market cheap. Some of them do not know the value of what they got from the soil.
So, when we came in we tried to raise the standard by formalizing that artisanal system. That is grouping them into cooperative entities so that they will add value to the growth of the economy of the country and value to themselves.
So, that one is ongoing but thank God we have gone to certain level. I was the former chairman, Kogi state chapter, Miners Association of Nigeria. I know before I left office and handed over to the executive, we had well over 100 cooperatives that we registered, formalized them. Those groups that are formalized are still at small scale level because generally mining is a capital intensive venture. So, to get the millions and billions of naira to buy processing plants, equipment, even trucks, bulldozers, excavators is much, is not easy.
And intervention fund, yes, government has tried but it’s peanut because the total sum of the intervention fund the Nigerian government has released so far, I think what they gave to mining altogether N2.5 billion from Bank of Industry N2.5 billion from Ministry of Mines & Steel, altogether is 5billion. That N5billion cannot even raise an entity, a complete industrial mining outfit, not to talk of N5billion for Nigerians ,that means we are still at baby level because if all Nigerians or few Nigerians that have access to this fund, they may get up to N100million, and N100million cannot buy excavator and bulldozer for example. So, that means we are not yet ready for mechanized mining. But by His grace since am now the vice president I promise them that we have to collaborate with the government. If(there is) no government hand, we can’t do anything. No individual can sponsor a mining outfit.
So, we tried to initiate what we call Barter Modeling of Mining operations in Nigeria. This I mean we need to look for investors, and then the government has to guarantee their equipment because there is no investor that will like to bring billions of dollars equipment to Nigeria and hand it over to individuals or companies whereby there is no security. So, the government must come in here, and if government is coming, government is not to pay any anything but to guarantee the security of the equipment.
Once we can get that, then they will install the equipment and make it work. During the time of the operation, all the products from that very outfit again, you now use part of it to be paying for the cost of the equipment the investor brings. So, in doing this, one, there will be no interest, in the next two years you will see mechanized mining outfits all over Nigeria without paying no single interest digit on top.
Two, no money will be moving from one hand to another, from one country’s boarder to another country, no. They bring in equipment; you pay back by materials from the site the equipment is producing. So, you go into memorandum of understanding with them. May be you will be paying 50% of whatever you produce, the other 50% you now sell it or they will be off taker, they now pay for that cash, you now use that as your working capital to running the outfit until when you offset the total amount for the equipment, the whole thing is yours fully.
Secondly, apart from no interest, they are transferring technology indirectly because you work together with workers. They are being trained to maintain, to work, and use the machine. Immediately they are going out, we Nigerians we maintain it. We want to introduce Solid Minerals Corridor. These investors coming, we make them to install equipment that will be manufacturing what will be used to assemble these equipment. So, before they leave the country, apart from miners having mechanized system of mining operation, to produce the equipment itself and spare parts we will be doing them locally.
Maximum, it cannot take us more than 3 years, if we can achieve this level within 3 years, the number of employment opportunities that is going to create is only God that knows.
The President is saying 100,000 people he wants to employ. Assuming now, I have a list of 30 licensed mining outfits in Nigeria which we want to push as the first phase. If eventually we are lucky we have the support of the government and the government which will support us . NEXIM BANK is the arm of government that will collaborate with us, this is why they are being established. So, with that, the next 3 years we now have mining outfit all over Nigeria because we are not going to locate it to one state. Then employment opportunities will rise very astronomically.
We thank God that the federal government has made mining a priority sector, so if we can get collaboration of NEXIM Bank to stand for miners, miners association of Nigeria is going to be in between because they know the genuine miners, the licensed miners, they know what individual miners are to do in Nigeria. So, the equipmens that is going to come, they will list it, the miners association will vet it, to know if this equipments are ok or not. And then once it is solved, miners association will be the eye of Nigerian government in that modem, while the NEXIM Bank will make sure that the exportation, importation, and the working capital that they are going to provide. That means even the NEXIM Bank is going to have equity in the whole agreement, although their equity they said is 1.5% which is very minimal, it will be helpful to Nigerians, than going to take loan or borrow money from somewhere.
So, we now put an average of 3 years, no matter how big or small an outfit is, it should have been over. And now it will be a full fledge outfit mechanized. Then, in addition of the technology gained, then we now go to the second step which will provide what is called the Solid Mineral Corridor whereby all the spare parts, all the machineries used in processing plants we have to manufacture it, because these 30 companies that is established will produce these finished products which we will just buy and then turn it to whatever machine or processing plants we want.
So, I believe by God’s grace as with the tempo we are going with and the collaboration opportunity we have with the government, if we can sustain it, in the next 3 years the Nigerian economy will be rich, the youths will be engaged, in meaningful work and they will get their living. The GDP will increase astronomically, infact, we will overshadow the petroleum industry in Nigeria. This is our hope, this is our target because our association is 4 years, and this is my own target within the first four years by God’s grace.
Q: To achieve this level of success in the next four years, how do you hope to tackle the infrastructural challenges of power, bad road, as well as water supply?
A: Already we envisaged that, and already we are able to convince the investors we are going to bring. Each mining outfit is in the community. There will be solar energy experts that will provide both for the plants and the community they are living with. And any company, based on Nigerian law has corporate social responsibility within the community, local government, state, and Nigeria as a whole.
So there are things that those entities will provide, and to pay it back is through the same solid minerals. We have thought of it everything is inclusive. By God’s grace, roads, water, everything is going to be there that is why I said is going to generate employment opportunities, empowerment, and so many things will follow.
Q: Non-availablity of accurate geological data is part of the numerous challenges that hinder the growth of the mining industry in Nigeria, what do think government should do to make this information available.
A: It was a challenge, and is still a challenge but the challenge is being tackled by the federal government. The Ministry of Mines & Steel Development has a department in charge; they are generating enough data right now. Already they made us to understand in one summit we went, they have given a contract whereby they are going to get a plane, they call it drone to fly over the whole country they will now take all the necessary data of everything and register it for every miners use. There will be a pool, anything you are to do, or anywhere you are to go, you go to the ministry, they will Google the particular local government; this is what the investors will see and if they are ready, they will come straight. The Ministry is working on that now.
Q: How has the presidential initiative on artisanal miners, initiated by the President recently helped the mining industry in Nigeria?
A: That initiative is going on, we attended one summit two weeks ago. They are using a German firm to take care of both the trainings, either the people going for jewelries, gem stones, etc. so, there are trainings, they have masters programme trainings, short courses training, just to specialize in using our coloured stones (Gem stones) to turn it into international standard, and so the value added chain is achieved with that. And so, instead of you selling, take for example sapphire now because you pick it raw, they buy it cheaply; you can take it to the unit where they will turn it, wash it, and then it becomes an international standard, so you sell it in dollars direct. And that is the essence of that solid mineral corridor. They will be the of-taker (Buyer) direct at international rate.
Q: Is there any link between illegal mining and the rising insecurity in parts of the country. And what do you make of the recent statement by the IGP that links illegal mining with rising insecurity in the country, especially in Zamfara state?
A: Actually this illegal mining increases this tempo of insecurity to be candid. Because we now find out that the mining outfits are in the bush. This illegal people will even go and seize up the sites. Take for example where you have precious metals like gold, silver, they will seize it and they will be mining directly, exporting (selling) it directly that is where they get their money.
So, once they discovered it’s is a very lucrative business, they started taking over strategic mining sites. You can see what happened in Zamfara. It is because government took this step they take, it would have been worse now.
Q: What particular step did the government take?
A: They stopped mining, they suspended mining activities for now. They have suspended mining activities in Zamfara and Kebbi states. The government going in, getting hold of the bad elements in the bush, if they don’t do that the individual miner does not have that capability or the muscle to stop any men coming with AK47.
Q: How about the issues of lack of proper legislation and inconsistent government policies that have scared away prospective investors from the Nigerian mining industry?
A: The illegal mining, when you now use the word illegal it covers everything as far as nothing of you is formal, that means you are not registered, you are not even recognized. You do things in the hiding, you cannot come out. Why can’t you be proud of your profession, if you are a good minded human being. The illegal mining contributed highly to this insecurity problem. So, the step the government has taken is correct. It is right. They are on the right part. Stopping them and then knowing fully who is licensed, then giving enough working environment, safe environment, for the licensed man to do his work. What he is licensed to do, not the bandits, or anybody coming because they see that that thing is a precious metal.
Q: Don’t you think the National Assembly has a role to play to make legislations that will curtail the activities of illegal miners?
A: Definitely, I think we have enough security regulation or policies in place right now if we go by what is there to checkmate the people. Where they think they need additional one, they did. Like the civil defense, they were not in the security arrangement before. They introduced them, they visit mines together with armed police men now. The civil defense knows the nooks and cranny of any community, while the police men who are brought in as visitors have the law behind them to arrest. And then the soldiers have the right to if it becomes necessary to act. So, with this they are checkmating it, the only thing is to now empower the miners to be able to take rightful hold of what they are licensed for.
Once, you empower these miners and everything is mechanized, if you are not skilled you cannot be there. So, in that case, no any idiot, ignorant person, or bandit can have access to it. Empowering the miners will drastically reduce insecurity in Nigeria.