Background: Nigeria’s Solid Minerals Sector at a Crossroads
The potential of Nigeria’s untapped mineral wealth
Nigeria is home to 44 different mineral resources spread across over 500 locations, including gold, lithium, barite, limestone, coal, gemstones, and bitumen. If properly harnessed, these resources could rival oil in driving economic growth.Why the sector has underperformed for decades
Despite this wealth, the sector has contributed less than 1% to GDP for decades, largely due to speculators hoarding licences, illegal mining, weak regulation, and investor distrust.Mining Cadastre Office (MCO) and Its Role
Creation and legal foundation under the 2007 Act
The MCO was established by the Nigerian Minerals and Mining Act of 2007 as the sole authority to administer mineral titles.Core functions and responsibilities
Its main objectives are to ensure transparency in licensing, prevent multiple allocations, and eliminate discretionary decisions that once fueled corruption in the sector.The Revocation Exercise Explained
Expired licences and speculative titles
Many companies obtained licences but failed to commence exploration or development, leading to the hoarding of mineral-rich cadastral units.Inactive applications and refusals
Nkom revealed that 2,338 applications were outrightly refused, while 971 licence grants were revoked after applicants failed to pay.Why 4,709 licences were revoked
In total, 4,709 licences were cleared from the system:- 1,400 expired titles
- 2,338 refused applications
- 971 unpaid notifications of grant
Statements from DG Obadiah Nkom
Revocation as a sanitisation process
Nkom emphasized that the revocation was not punitive, but a deliberate process to stop racketeering and ensure only credible operators remain.Investor confidence after reforms
The reforms have boosted investor trust, reassuring both local and foreign companies that Nigeria is serious about transparent mining governance.Legal compliance and litigation success
Nkom noted that the MCO has enjoyed 100% success in litigation, as all revocations follow the law to the letter.Minister Dele Alake’s Reforms
Prior revocations in 2024
Earlier in 2024, the minister revoked 924 licences over failure to pay statutory fees.Ending licence racketeering
Many speculators previously acquired titles over known mineral deposits, only to sell them off at inflated prices—a practice the ministry has now outlawed.Crackdown on illegal mining
The government has vowed to prosecute illegal miners, especially those operating outside their licensed mineral scope.Combating Fraudsters and Impersonators
Fake agents and touts exploiting investors
Fraudsters posing as MCO staff deceived investors into paying for fake licences.Prosecution plans with DSS and EFCC
The MCO has escalated cases to the DSS and EFCC, promising to “bite hard” against offenders.Integration with CAC for verification
To protect investors, the MCO now verifies applications in real time with the CAC API, ensuring only duly registered companies qualify for licences.New Licensing Rules for Serious Investors
- Companies must present bank statements and letters of financial capacity.
- Mining outside licensed minerals is now grounds for revocation and prosecution.
- Operators can, however, apply to expand their licences if new minerals are discovered.
Impact of Revocations on the Sector
Increase in foreign investor interest
Nkom revealed that reforms are attracting more foreign companies eager to enter Nigeria’s mineral-rich market.Local cooperatives and small-scale miners
Small-scale miners are also organising into cooperatives, gaining access to licences previously dominated by speculators.Challenges Still Facing the Sector
- Widespread illegal mining and mineral smuggling.
- Low contribution to GDP despite massive mineral deposits.
- Need for better infrastructure to support mining operations.
