15 May 2018

Nigeria: Absence of Policy Framework Threatens Extractive Industries Sector

The Chairman of Mining and Solid Minerals Group of the Lagos Chamber of Commerce and Industry (LCCI), Mr. Babatunde Alatise has raised the alarm that the absence of effective policy in Nigeria's mining sector and the obsolete Mining Act of 1964, which governs explosives, are threatening operations in the extractive industries sector.

Speaking to journalists in Lagos at the weekend, Alatise also said the absence of effective template for community engagement had the potential to fuel crisis as different communities make frivolous demands.

He argued that states are discouraging legal miners as a result of lack of proper framework for mining.

"Now, Lagos State government banned legal sand miners from operating. Why - because of environmental issues, which are very important. You can't take away that. But if you have a situation where legal miners are being banned, what do you say to the illegal miners that are working but do not even go to Abuja for documents? So, what am I trying to say? We want to get rid of the illegal miners but we are making it hard for the legal miners - basically opening the door for the proliferation of explosives because the moment you don't have a proper framework for mining and illegal mining is thriving and you are making it hard for legal miners to go through the processes of going to Abuja, digging up documents, paying all sorts of crazy money to get their license only for the state government to stop you," he explained.

Alatise acknowledged the need for states to generate revenues but added that there should be clear rules of engagement.

"The states have their own agenda. Fair enough, we want the states to generate revenues but there has to be clear rules of engagement. A state cannot be an operator and also a regulator," he added.

In the international scene, Alatise added that the wars ravaging parts of Africa were partly caused by conflicts associated with solid minerals.

Alatise noted that what saved Nigeria from similar war was the country's focus on oil and gas, otherwise Nigeria would have been plunged into crisis if it had focused on the mining sector.

According to him, the problems in Nigeria's oil and gas sector have to be resolved before the country opens up the mining sector.

He said a lot of things had gone wrong with the mining sector, citing the obsolete Act governing explosives, which was enacted in 1964.

"At the moment, everybody imports explosives until very recently when two explosive manufacturers started operations in Ogun State. If you do not create conducive environment for local manufacturers, there will be proliferation of explosives due to the activities of illegal miners and importers. Chemical explosives are sacrosanct to economic development because without explosives, there will be no development," he said.

Alatise spoke to journalists as part of the activities ahead of the May 21 - 22 SITEI 2018 conference in Abuja themed 'Managing Conflict and Security in the Extractive Industries.'

He argued that managing conflicts is important in solid minerals sector because the materials used to extract solid minerals can also be used in terror attacks.

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