Adanna Okoro
Mon, Sep 4, 2023 10:45 PM

Solid Minerals Sector in Nigeria Generates N193.59bn Revenue in 2021, NEITI Report Reveals

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Solid Minerals Sector in Nigeria Generates N193.59bn Revenue in 2021, NEITI Report Reveals
The solid minerals sector in Nigeria generated N193.59 billion in revenue in 2021, according to a report by the Nigerian Extractive Industry Transparency Initiative (NEITI). The report highlighted the significant increase in revenue from the sector and called for the implementation of sustainable strategies to boost revenue and reduce reliance on single minerals.
The solid minerals sector in Nigeria continues to play a vital role in the country's economy. According to the latest report by the Nigerian Extractive Industry Transparency Initiative (NEITI), the sector generated a total revenue of N193.59 billion in 2021. This represents a remarkable increase of 51.89% from the previous year's revenue of N116.81 billion.The report analyzed the payments made by 1,214 companies in the sector and the receipts by key government agencies such as the Federal Inland Revenue Service, the Mining Cadastre Office, and the Mining Inspectorate Department of the Ministry of Mines and Steel Development. It also examined the quantities of minerals produced, utilized in the country, and exported from the sector.The revenue breakdown shows that the Federal Inland Revenue Service collected the bulk of the revenue, amounting to N169.52 billion. The Mining Cadastre Office generated N4.3 billion, while the Mining Inspectorate Department generated a total of N3.62 billion.Despite the increase in revenue, the report highlights that the solid minerals sector's contribution to the overall government revenue is still significantly low. Out of the total government revenue of N6.62 trillion in 2021, the sector accounted for only 2.6%. The report emphasizes the need to tap into the sector's economic potential more effectively.In terms of production, the report reveals that the total volume of solid minerals used or sold in 2021 was 76.28 million tons, with a royalty payment of N3.57 billion. The top minerals produced include granite, limestone, laterite, clay, and sand. Dangote Plc recorded the highest production volume with 28.8 million tons, followed by Bua and Lafarge with 8.4 million tons and 4.3 million tons, respectively.The report also highlighted the geographical distribution of production with Ogun State leading the way with 17.5 million tons, followed by Kogi State with 16.3 million tons and Edo State with 8 million tons. On the other hand, Borno State recorded the lowest production volume of 25,500 tons.In terms of exports, the total minerals exported in 2021 amounted to 142.54 million tons with a Free on Board (FOB) value of $101.29 million. The report notes that China was the principal destination for Nigeria's mineral exports, accounting for 97% of the export volume and 88% of the export value. Other destinations included Malaysia, Korea, Thailand, and the UAE.Despite the growth in the sector, the report points out several areas that require attention and improvement. For instance, the report highlights the outstanding company liability to the government, amounting to N1.06 billion, due to the failure of some companies to pay their annual service fees. It also raises concerns about the low compliance with environmental standards and the lack of access to Community Development Agreements (CDAs) and their non-compliance by some companies.NEITI recommends that the government urgently reviews the solid minerals roadmap, implements sustainable strategies to boost revenue from other strategic minerals, and reduces reliance on single minerals like limestone. The report also emphasizes the need for strict actions and sanctions against non-compliant companies in terms of environmental standards and social benefit to host communities.Overall, the NEITI report highlights both the progress and challenges in Nigeria's solid minerals sector. It serves as a call to action for policymakers and stakeholders to maximize the sector's potential for revenue generation, job creation, and sustainable development.

Source of content: OOO News 2023-09-04 News

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