Positioning Solid Minerals Sector For Alternative Energy, Employment Generation - Leadership Newspapers

While many developed and developing countries of the world have taken advantage of the alternative energy resources nature provides, Nigeria has continued to lag behind in its struggle to generate sufficient power supply. RUTH TENE NATSA writes on the need to take advantage of coal as an alternative energy source as well as a platform for employment generation.

A major challenge to the economic development of the nation has been blamed on the poor or unavailable energy and power supply, said to be a major factor, for manufacturing and production by small, medium and large scale industries and businesses.

While there are many sources of energy particularly through renewable energy, including hydro (water) solar (sun), wind and coal among several others, government has failed to take advantage of these resources rather restricting its attention to electricity.

Nigeria’s electricity generation though said to have attained a steady climb of 4,044 megawatts (MW) in the past two years, is still below the peak generation level expected. While the country’s power generation capacity currently stands at 6,000 MW, it is expected to grow to 40,000 MW by 2020.

Experts and stakeholders are of the view that using alternative energy will fast track the nation’s dreams of achieving a steady and more dependable source of energy to tackle the needs of the nation’s huge population. This is in view of the huge potential coal is said to have as an alternative to power generation.

Speaking in an exclusive interview with LEADERSHIP Sunday, coal miner and expert, Dr Innocent Zuma says Nigeria has done very well in developing its coal through President Goodluck Ebele Jonathan. In his words, “the President Jonathan administration has given a lot of impetus to the coal sector.”

According to him, “today Nigeria is mining coal, my own group has over 300,000 tonnes of proven coal reserves and we are mining coal in Nigeria, so I do not see how people can be saying they are importing it, whereas it is in abundance.”

Reacting to the need for further government intervention in the sector, he said, “the federal government has done all it has to do for the success of the sector and all that is required are long term and cheap funds to move the sector forward. He adds that anybody importing coal into Nigeria is a traitor to Nigeria economy and development and that cannot be allowed to happen.”

Speaking on the challenges that have hindered the development of the sector as a whole, the miner said, “the problems from my own point of view is that our past leaders neglected the sector so much that fresh investments were not made. And the solid minerals and power sector is one that must be actively invested in in all the chains, including distribution, transmission and other sectors of it.”

Zuma maintained that since President Jonathan took over he had done so much but the much that was done cannot immediately transform the sector, “it cannot be done overnight, power sector infrastructures are not such that can be bought off the shelf, it requires time and huge investment, but if we continue on the path we are now, it will surely get better.”

He assured that “the challenges that have delayed the 30% coal to power generation have been overcome by the enabling environment provided by the outgoing administration.”

Meanwhile speaking on the progress made in the development of the solid minerals sector the minister of Mines and Steel Development, Architect Musa Mohammed Sada said, “the President Goodluck Ebele Jonathan government has sanitised the sector through a sound regulatory framework, but maintained that policy instability was not good for mining development.”

According to him, “I realised that the intermittent changes seem to be affecting the progress of the sector that is why we set out to develop some sustainable processes in making sure we institutionalise those key areas of operations in the sector.”

Speaking with journalists in Abuja recently, Sada said, “for mining companies to successfully operate, what they require is continuity of policies and guidelines.”

“The effort of the outgoing government was to sanitise the system, develop a framework and provide a road map that could be further built on.”

He noted that “though the roadmap is not a perfect document, it’s a guideline that can be built on, you can review it from time to time and see what adjustments can be made to move the sector forward.”

Speaking on the myriad of challenges to the development of the sector in general, Arch Sada said the sector is faced with varying policy challenges, poor infrastructures, power, lack of equipment, low technical know-how among several others.”

Also speaking in an exclusive interview with LEADERSHIP Sunday, the CEO Promethean Resources Demola Gbadegeshin asserted that “as far as the regulatory regime for mining is concerned, Nigeria has one of the best in the world, it is modelled after the best and even improved on from countries such as Peru, China and Australia and as far as we can implement and enforce those regulations, the sector will be good. I also think the current regime is doing a good job and doing its best.”

“The other aspect is the private sector, if there is nothing to regulate, the regulators won’t be able to do their jobs, so there needs to be more investments going into the sector. We need to invest and encourage the government and also encourage more players, the more players we have the more the competition, and the more competition we have the more viable the sector will be.”

It should be recalled that as a means to curbing Nigeria’s myriad power challenges, the federal government through the Ministry of Mines and Steel Development initiated the coal-to-power project with the aim of generating 30% power using coal by the year 2020.

While these efforts have been lauded and applauded as a means to boost power generation, onlookers in the industry fear that it is just one of the policy statements government makes on paper to create the impression that much is being done.

This pessimistic view is caused by the fact that while it is believed that the sector is rich and has much to offer particularly at a time when Nigeria can no longer boast of its huge and continuous revenue from oil and gas, very little has been done to address the many challenges that make the sector a ghost to its agriculture counterpart.

Mining in Nigeria, according to records, began over 2,400 years ago with artisanal mining taking the initial form as practised by communities while seeking for natural resources.

In the area of funding, the solid minerals sector remains one of the most underfunded sectors and this is also complimented by the fact that revenue generation by the sector is said to be below 0.5% as against agriculture with over 40%.

Funding institutions have also not shown much interests in tying down their finances as it is said mining often requires long term funding to begin yielding profits, as such mining activities are mostly left to artisanal and small scale miners (ASMs) also known as informal miners or illegal miners.

Other challenges hindering development in the sector include lack of infrastructure such as roads, the collapse of the nation’s rail system which could aid movement, poor technical know-how, policy instability and power challenges among several others which continue to hinder the development of the sector.

Another major challenge to the sector’s development is the policy somersaults the nation suffers from. It is believed that every new government comes with new policies as such policies created by previous transitions do not allow for continuous development of the sector.

As a way of addressing present day challenges in the mining sector stakeholders have called on the incoming government to take advantage of the existing opportunities the sector have.

Experts have agreed that the sector has the capacity to generate huge revenue for the government through tax and royalty payments, registration and payments of mineral titles among others, adding that “the sector has the potential to generate employment even more than the nation’s agricultural sector which presently accounts for highest employment generation.”

“It is also agreed that while the sector continues to suffer neglect from government, private individuals and illegal organisations are enriching themselves at the detriment of the government and the masses who suffer from the impact of mining in their communities.”

In the words of environmental activist and country director, Global Rights, Abiodun Baiyewu, the sector has the potential to generate revenue for the government but he notes that while it will generate in a lot of solid minerals, globally the price of solid minerals are dropping. Australia for example depends largely on iron and the price of iron just like that of hydro carbons has dropped.

“However, there is a lot of revenue that goes out of Nigeria every day from solid minerals, if we do not begin to harness these resources and know exactly how much is generated from them, government cannot levy or tax them adequately. Most of them are not taxed at all and nothing is paid for the mining of these minerals and then they go out of our borders every day.”

He notes that despite the fact that there is a lot of artisanal mining going on, “there are also lots of foreigners mining that we are not paying attention to, even the local miners we are not paying attention to them. A lot of people are getting rich from gold mining in Zamfara and lead in Ebonyi from which they build mansions in Dubai from wealth they get from Nigeria, so while their work is legitimate, it is not benefitting the larger society, instead it is depriving and of course there are opportunity cost on the larger society.

In her summation, she stressed the need to give proper attention to mining so as to ensure that minerals are not taken out of the country unaccounted for. She also called on the incoming government to empower NEITI as a means to curbing some of the excesses in the solid minerals sector and also as a means to monitor the nation’s mineral resources.

Also speaking with LEADERSHIP Sunday, President Miners Association of Nigeria (MAN) Alhaji Sani Shehu called on the incoming government to take mining seriously by funding it and giving it the needed publicity as is being done in the agricultural sector.

He assured, “that opening funding windows and creating such publicity will not only open funding windows for investors but will ensure that the sector becomes highly competitive and lucrative.”

From past experience there is no doubt that funding the sector, stabilisation of policies, provision of better infrastructures, the revival of the nation’s rail system as well as creating viable mineral processing zones will ensure that the nations minerals are protected, government revenue is assured and secured while thousands of jobs are created in the process.

In establishing a viable and alternative power through coal, the incoming government must begin to implement the many policies that have been laid for the development of the sector.

In the words of the president of Progressive Miners Association, Sunday Ekozin, “the sector does not need any more policies as it suffers from lack of implementation and not lack of policies.”

Also speaking, the Korean Ambassador to Nigeria Noh Kyu-duk says, “in view of the collapse of oil prices, it is important for the Nigerian government to exploit its solid minerals resources.”

“I understand that it is very important for the Nigeria government to exploit its solid mineral resources because at the moment, the falling down of oil prices is affecting the Nigerian economy in an erratic way, so it is better for the government to develop its solid mineral resources” he states when he paid a courtesy visit to the minister of Mines and Steel Development, Architect Musa Mohammed Sada in Abuja recently.

Now more than ever, the federal government must ensure that the solid minerals sector is repositioned to compensate for the fall in the price of oil, to supplement for the nation’s energy and power needs and become the job creation platform for the many unemployed Nigerian youths.