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Nigeria seeks US$7bn to boost mining, steel industry

Fameyi pointed out that US$5mn investment will help to kick start the mining sector. (Image Source: Bishnu Sarangi/Pixabay)

Nigeria is seeking investments of US$7bn in mining and steel sectors over the next decade for developing the gold and iron ore extraction industries to diversify its oil-dependent economy

Nigerian solid minerals development minister Kayode Fayemi said that one of the government’s priorities is to meet its annual steel demand of 6.8 mmt. The current output of one-third of that and is produced mainly from scrap iron.

“About US$5bn will kick-start the mining sector,” Fayemi said in an interview in his Abuja office.

He also pointed out about US$2bn investment will help to revive Ajaokuta, a steel complex with an envisaged installed capacity of 5mmt of steel a year but is currently non-functional.

Improving mining output, developing infrastructure and boosting agriculture is part of the government’s plans to broaden Nigeria’s economy. “In two to five years, we want to have started production of iron ore, lead, zinc, bitumen, nickel, coal and gold at a serious scale,” he said.

He said that some of the companies considering investments in Nigeria’s mining sector include Lagos-based Multiverse Mining & Exploration Plc and Australia’s Kogi Iron.

The Federal Government is working on a mining plan and a bill proposing the creation of regulatory agency for the sector. Fayemi said that an autonomous agency would be better positioned to focus on performance and efficiency of the sector.

“Currently, the ministry does everything: licensing, monitoring, inspection, and it should not be like that,” he said, pointing out that uncertain regulatory environment dissuades prospective investors. The new legislation is to include incentives to attract investments such as full foreign ownership of mining projects.

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