Why the government should support the mining sector – Prof. Adekoya

Prof. John Adekoya

October 03 (THEWILL) – Former Dean of Akure Federal University of Technology School of Earth and Mineral Sciences and Nigerian Academy of Sciences Fellow Prof. John Adekoya speaks recently on a compendium of metallic and industrial minerals from Nigeria released to feature a neglected gold mine waiting to be explored and mined for the country’s economic self-sufficiency and other issues in this interview with AMOS ESELE. Extracts:

Given the ongoing VAT war between the federal government and the states of Rivers and Lagos, isn’t it time for states to find a way to mine the mineral resources in their localities to increase the revenue generated? internally?

This issue was in dispute many years ago when the federal government urged states that wanted to invest to get into mining. Ondo State has established a company to mine bitumen in the State. It was during the military era. He needed partners to bring their money, but it didn’t work.

If so, what would you advise the government to do?

In the case of gold, which was discovered in Ilesha in the 1950s, people like the late Odutola invested there on a small scale. If you are going to do large-scale mining, you need large-scale capital. What the government can then do is offer incentives to minors. Many years ago, taxes took a lot of people out of mining. The government can encourage investors by buying shares in companies to encourage their owners. I remember working as a consultant with the late Professor Sam Aluko when he headed the National Intelligence Committee during the military era. His idea was that state governments, say, in the Southwest, could work together to set up a refinery. They can contribute money for it. But I suspect that the governors will not be interested in such projects which have a long gestation period. They want the money fast.

What do you say about the state of Ajaokuta Steel Company today?

This is the tragedy of our country because, moreover, during our years of civil war under the military head of state, General Yakubu Gowon, when Britain did not support Nigeria because of the Biafran War, Nigeria had to look to Eastern Europe to befriend Russia, then the Soviet Union. The Russians came to Nigeria and signed a memorandum of understanding. Then there was iron ore around Lokoja and the Koton Karfe area, but the metals were phosphorus and were not good for iron production; it made iron brittle and the Russians didn’t have the technology to remove phosphorus. They had to look for new deposits. This is how we got to Itakpe, so they had to set up the iron and steel industry there. They spent a lot of money and did 95% of the work, but because of the corruption the Russians got angry and left. The government, during Alhaji Shehu Shagari’s civil administration, said it had no money to complete it. There is a terminology we use in economic geology that the steel industry is the backbone of development and industrialization. All the equipment we use is made of iron and includes machinery, cars, industrial equipment, buildings and even roads. The government should try to revitalize it.

Why do you think state governments are reluctant to explore these gold mines in their localities?

As I explained in chapter 28 of my book, part of the problem is the lack of capital and courage. If you want to get into exploration and mining, you need a lot of nerves because you can invest your money in it and not recoup your expenses. An example of such courage is Shell, which finally found oil in Oloibiri in 1956. Prior to this breakthrough, the company had spent nearly £ 30 million in present-day Ondo State and the Sokoto Basin and still has not found any oil. It was the discovery in the Niger Delta that helped the company recover its expenses. The mining activity is therefore discouraging for people. Unless businessmen like Aliko Dangote and Abdul Samad from the BUA group of companies step in, we will continue to find small-scale artisanal miners in the business.

You talked about inadequate government control over mineral resources. Is this why there are illegal minors in the country?

In the 1990s, West African agents from Guinea, Senegal, Ghana and The Gambia rushed to Nigeria to mine tin, columbite and tantalum, which are used in ICT. They illegally mined and took billions of dollars from Nigeria. They did it during the military era, between 1989 and 1995. Then there was a lot of massive illegal mining and the government couldn’t contain it. This is what is happening in Zamfara State. Illegal miners and bandits cooperate and deplete Nigeria’s income.

What do you advise stakeholders about illegalities everywhere?

It’s the same suggestion we’ve made in the past. I was a member of a national policy committee set up in the 1990s and chaired by the late Dr Pius Okigbo. We made some recommendations on how to stop illegal mining and profit from it. First, we recommended that illegal artisanal miners helped by their allies in Senegal, Guinea and Ghana be licensed and then taxed. In response, the government set up a federal government mining initiative led by a lady whose name I have forgotten. She was supposed to meet with the agents, buy their earnings and officially sell them to the Central Bank of Nigeria. Second, we recommended that the miners be organized into a cooperative so that it is easy to control them.

They can exploit mining titles for remuneration and assume the social responsibility of companies in their field of activity. The government is aware of this suggestion, but I am not. They did apply it. There was even a time when I learned that the government had taken a loan from the World Bank for this, but I don’t know if they used it for this purpose.

There is a third recommendation which deals with the government’s inadequacy in the management of the mining sector. The colonial government introduced the mine police to monitor and inspect mines and arrest illegal miners. In this regard, it was suggested to use the National Security and Civil Defense Corps, but I do not know if this crystallized.

When you said that the government survey department where you worked conducted a geological survey of the country, what exactly did that mean?

Geological survey is the main function of the Geological Survey of Nigeria, a department of the Federal Ministry of Mines and Energy. The main study is to carry out a geological mapping of Nigeria, first on a small scale and then on a larger scale, to discover the water potential of the country and the types of geological rocks and mineral resources in all the rocks. It highlights the map of Nigeria, showing the distribution of rock types.

As someone who has worked in public and academic circles, why do you think the federal and state governments have been unable to mine and export the discovered mineral resources in commercial quantities in the face of declining oil revenues?

It is one thing to discover mineral resources; it is quite another to explore and exploit them. It takes a lot of money and effort to evaluate the minerals, to map the mineral that was discovered first on a small scale and then on a large scale. Mining involves digging pits and sampling them in different places, depending on the site you are mining. The government does not have the money to do it.

Why? If not the government, then who has that kind of money?

The private sector. Because they are interested in it, they will enter it with all their investment capital. The International Petroleum Companies (CIOs), such as Shell, Chevron, Mobil who have invested in the oil sector in the country, have the capital and the courage. They can bring their own money, doing the study of the whole basin and the geology costing up to $ 20 million, especially when they are doing it offshore. Sometimes the cost can go up to $ 100 million. Despite the investment, you may still not be able to find enough minerals. In the case of the Niger Delta, some wells remain to be exploited long after the end of the work. They are called marginal fields that small indigenous companies like Seplat and the oil development companies of the Niger Delta take over.

In the early 1990s, the World Bank organized a mining conference at which it advised the federal government against setting up mining companies as it was doing with the Niger Coal Corporation. They found that with the exception of Brazil, experiences from other parts of the world had shown that the government was ineffective in managing mining companies. I remember arguing that if Brazil could succeed, why not Nigeria. Maybe they were right because the Nigeria Mining Corporation quickly packed its bags due to nepotism. One of the main officers, I have learned, is now in detention for embezzlement.

Some companies mine minerals in many states without authorization. What do you say about this?

Yes, artisanal miners are taking over with negative effects on the environment. Over the past seven or eight years, artisanal miners, particularly in the north, have been doing this. Bigger companies are also involved like what we have in the Islesha region of Osun State where Canadian and Chinese companies are investing in gold mining.

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