NEITI: Three Companies Paid 94.6% of Mining Industry’s Social Expenditure in 2020

Emmanuel Addeh in Abuja

Only three companies paid 94.6 per cent of the total N3.887 billion social expenditure in the mining sector in 2020, the latest report from the Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed.

The document listed Dangote Plc, Lafarge-Wapco as well as First Patriots as the three out of the 29 entities that submitted their social spending, as being responsible for the N3.48 billion of the N3.887 billion payment.

Detailing the data in its Solid Minerals Audit for the year under review, the Dr. Ogbonnaya Orji-led organisation noted that while Dangote paid N2.18 billion, representing 56.36 per cent, Lafarge-Wapco made a payment of N1.260 billion, while First Patriots paid N219.9 million.

Some other companies which provided documents on their social spending during the period, according to NEITI, included: CCECC, Nigeria Limited, which paid out N49.2 million or 1.7 per cent and Triacta which expended N35.5 million or 0.92 per cent of total spending.

In all, the 29 companies spent N376.5 million on their mandatory social obligations and N3.495 billion on non-mandatory social spending, to hit a total of N3.87 billion.

Similarly, three separate entities paid N5.7 million as environmental expenditure, including Mother Cat, Rock Bottom and Solid Unit, Nigeria.

Out of the 102 recorded as carrying out operations in the mining industry, only 29 complied with providing details of their social spending for audit, NEITI stated.

The Extractive Industries Transparency Initiative (EITI) requires an audit of social payments, environment, quasi fiscal expenditures, the contribution of extractive sector to the economy and environmental impact of extractive activities as part of the content of the report.

The organisation explained that social payments are payments or contributions by extractive companies to promote the development and foster better partnerships with host communities.

“These payments can be mandatory (mandated by law or contractual obligations) or non-mandatory (i.e., discretionary) and can be made either in cash or in kind,” it noted.

On the other hand, it explained that environmental expenditure are payments by companies to the government related to the environment, while quasi fiscal expenditures are calculated if state-owned enterprises participate in the sector.

“The social expenditure in 2020, based on data received from 29 companies, was N3.87 billion, representing an increase of 49 per cent compared to the 2019 figure.
“There is still much to be done by the regulatory agencies to ensure all companies in the industry abide by the social expenditure commitments they signed in the Community Development Agreements (CDAs) before commencing operations,” NEITI stated.

In terms of employment, NEITI noted that of the 29 companies which provided information on the development, it found that 5,820 workers were hired in the sector, 86 per cent of which were males and 14 per cent females.
NEITI observed that despite large quantities of barite in the country, cutting across Nasarawa, Plateau, Taraba, Benue, Ebonyi and Cross River, many Nigerian companies still import the mineral.

Despite the social spending, many host communities complain of being badly treated by the companies operating in their areas, with their operations resulting in the devastation of the environments and sometimes leading to lead poisoning.