As MCO Raises the Bar in Revenue Generation

Kasim Sumaina X-rays the Mining Cadastre Office year 2021 activities and projects what to expect in the year 2022.

In spite of the negative socio-economic impact of COVID-19 in Nigeria and across the world, some agencies and parastatals in the President Muhammadu Buhari led administration have remained resilient.

Though, industry players have faulted the age long abandonment of the solid mineral sector for its petroleum counterpart, noting that the attitude of the country’s leaders has led to non-industrial development.
Their notion is that with adequate funding especially in research and development, the country’s mining sector will be able to ensure economic growth and sustainability.

With the foregoing coupled with budgetary constraints and other challenges at the headquarters and newly created zonal offices, the Mining Cadastre Office (MCO), led by its Director-General, Simon Obadiah Nkom, has disclosed that as at the end of last year, it generated N9.384 billion, which was a record within a period of three years.

The main agenda of the present administration is to diversify the economy through non-oil sector, majorly, Solid Mineral and Agriculture. And seven years into the administration, the mining sector in particular has received adequate attention after several years of abandonment. Though, the Ministry of Mines and Steel Development in its effort to put the sector in its rightful place came up with a Road Map, launched by the former minister and incumbent Governor of Ekiti State, Dr. Kayode Fayemi.

The Road Map has made the sector attractive to investors and has placed the sector on the path of recovery, growth and development. The mineral sector alongside others has had enough government presence. But concerns have been raised in some quarters about the dwindling revenue generation by these sectors despite attention accorded them. Though, the parent body of the sector, the Ministry of Mines and Steel has recorded some giant strides, unfortunately poor management, double taxations and activities of illegal miners seem to be the source of worries to industry observers.

The Vice President, Prof. Yemi Osinbajo recently warned that unless the country gets the fundamental of its solid mineral resources right, it will continue to live the paradox of suffering in the midst of plenty. He added that while the Ministry of Mines and Steel has the legislative mandate to regulate mining, many states and local governments have embarked on the imposition of their own rules and regulations, including issuance of Registration, Permits, Community Development Agreements (CDA) and Memorandum of Understanding (MOU) on miners.

According to him, some state governments, in a bid to shore up their revenues, impose illegal fees, taxes, and levies on foreign and local licensed mining companies and operators. He added that enforcement of the taxes often leads to the frequent arrests and harassment of licensed miners and their workers and closures of mining sites.

It would be recalled that it was in a bid to regulate all aspects of exploration and exploitation of solid minerals in the country that the Nigerian government in 2007 re-enacted the Nigerian Mineral and Mining Act.

The step was also aimed at fostering the growth and development of the sector. The Act vested the ownership and control of all lands in which minerals are found in commercial quantities in the government of the federation thereby prohibiting unauthorised persons from exploration or exploitation of these mineral resources.

The right to explore or exploit minerals in Nigeria is evidenced by the grant of a mineral title, which can be granted to an eligible applicant under the Act in accordance with the Nigerian Minerals and Mining Regulations (NMMR) and after the submission of an irrevocable consent form by land owners or occupiers.

The granting is under the jurisdiction of the MCO, an agency supervised by the Federal Ministry of Mines and Steel Development, which is responsible for the administration and management of mineral titles and the maintenance of cadastral registers.
MCO, as an agency issues, grants, suspends, and upon written approval of the minister, revokes any mineral title where a titleholder fails to pay a prescribed fee such as the annual fee.

It also keeps a chronological record of all applications for mineral titles in a priority register, which ensures the agency treats all applications on a first come first served basis and equally applies the principle of ‘use it or lose it’ to mineral titles.
However, an application for a mineral title may be refused where in the case of an individual is under the age of 18 years or is an undischarged bankrupt or otherwise declared bankrupt under any written law or has been convicted of a criminal offence under the act or regulations.

Also, it is noteworthy to know that no title can be revoked without giving a prior notice of 30 days to any defaulter, sent to a registered address.

So, barely 13 months to the 2023 general elections and given the continuous zeal of the current administration to diversify the economy through the non-oil sector, the MCO new revenue generation should be encouraged and supported.
Nkom, while having a round table media chat with selected journalists in his office, in Abuja, explained that the right to search for or exploit any mineral in Nigeria is governed by different mineral titles.

He listed the titles obtainable in the country to include the Reconnaissance Permit (RP), Exploration Licence (EL), Small Scale Mining Lease (SSML), Mining Lease (ML), Quarry Lease (QL) and the Water Use Permit (WUP).

On revenue generation, he maintained that in 2019, N2.580 billion was generated for the federation account, while for 2020, which was the period of the pandemic, MCO surprised everyone by generating N2.303 billion, despite the lockdown.

While giving a breakdown of revenue generated by the office, Nkom, who was appointed on January 11, 2019, stressed that though the agency has been generating revenue for the government but at a time when everyone was battling the effects of Covid-19 pandemic, the MCO was able to generate the sum of N2.13 billion in 2017, which though dropped sharply to the sum of N1.55 billion in 2018.
According to him, in 2019, the office raised the ante by N2.58 billion which was the second highest since inception of MCO in 2007 and despite the COVID-19 pandemic.

He, however, said in the first quarter of 2021, from January to May, it was able to rake in N2.016 billion while at December 31, 2021, the revenue generated rose to N4.3 billion, which was the highest revenue generated ever by the office.
On mineral titles, Nkom observed that: “Presently, 7018 valued titles are active. If I give you an overview of the entire statistics from inception, I think it will guide us by giving us a picture of what we are talking about because statistically, over 34,000 applications have been received from inception.”

He added that 15,483 applications were rejected, 4,997 revoked while 6,588 active titles are presently in existence.
“There is an increase in Mineral Title Application submission, increased revenue generation – N4,301 billion organizational growth – establishment, and operationalisation of MCO offices in the six geo-political zones of the country.

The MCO boss also noted: “We currently collaborating more closely with other departments and agencies of the Ministry (MID, MEC, ASM, NGSA etc) specifically Mines Inspectorate Department Job creation. A total of 38 staff were employed in the upgrade of the SIGTIM software to the web-base Online Mineral Title Administration and Management system – eMC+Activation and Integration of e-Recording and Archiving of Mineral Title documents.

In the light of this performance, players in the sector have, however, urged the federal government to do a rethink and concentrate on solid minerals to diversify the economy thereby increasing its revenue base as prices of oil dwindle daily.
They stated in particular that for the solid minerals sector of which the country is blessed with about 44 minerals, there is need to invest in accurate data gathering in order to attract the right investors.

Looking forward to the year ahead, Nkom stated that the concern of the MCO is to be able to imbibe transparency, security of tenure and non-subjectivity all towards attracting the needed investments in the sector. He also emphasized the need to generate the needed revenue for the country especially with the support of government and other stakeholders.