The continuous fall in global oil prices to a record low of $27, as of yesterday, once again emphasizes the need for oil–dependent countries like Nigeria to diversify. With the bulk of Nigeria’s 2016 budget set on diversifying the economy, perhaps this could not have come at a better time. States in the country, which have grown so dependent on the Federal Government for their share of the oil revenue, will eventually be forced to promote internal revenue generation and mining could pave the way to that.
Before the discovery of petroleum, the Nigerian economy was dependent on the agriculture and mining sectors to generate revenue for the country. For example, coal from Enugu’s coal mines, alone, were enough to power some of our railways as well as generate electricity for the country. In the past, Nigeria was also once the World’s largest exporter of columbite and minerals such as tin, coal and gold were mined in commercial quantities. In 2009, the Federal Government, through the former Minister of Mining and Steel Mrs Diezani Alison-Madueke, announced that the country had commercial deposits of 37 minerals scattered around all its 36 states. Kogi state has commercial deposits of about 29 mineral resources, with coal being the most among them. Studies have also shown that Kogi state’s coal deposits can power Nigeria for 400 years, a potential panacea to Nigeria’s current power problems. Though the claim could potentially be a gross exaggeration, it is a testament to the richness of the mineral in the state.
In 2010, Alison-Madueke also promised that the Federal Government would focus on 7 minerals; coal, gold, bitumen, limestone, barite, iron ore and tantalite, but it has been 5 years since this announcement was made and nothing has been done to address this. Instead, Nigeria has continued to witness private companies investing in the mining sector with the Dangote cement factories being a prime example. Even though these factories provide jobs for people in those communities, the country ought to be gaining a lot more from the export of these solid minerals. Last year, the president of the Miner’s Empowerment Association of Nigeria, Sunny Ekosin, revealed that the country loses eight trillion Naira yearly to unexploited gold.
The exploitation of mineral resources has been credited as the bedrock of industrialization for any nation meanwhile, in Nigeria, mining accounts for only 0.3 percent of the annual GDP. Russia’s coal exportation and the United States’ gold rush of the nineteenth century are great examples of economies being boosted by mining and the time for Nigeria to focus on solid minerals in order to fully profit from their natural deposits is now.
