House Proposes 5% Host Communities Fund for Mining Areas in Nigeria

Juliet Akoje in Abuja

The House of Representative’s Committee on Solid Minerals yesterday  proposed 5 per cent of the revenue of all minerals mined to the host communities.

The Chairman of the Committee, Hon. Jonathan Gaza made this known at a Public Policy Dialogue held in Abuja.

The piece of legislation titled: “Nigerian Minerals and Mining Act (Amendment) Bill” was sponsored by Hon. Jonathan Gbefwi and Hon. Benjamin Kalu.

Gaza noted that the bill when passed will allow for formalisation between states and the federal government to work together in order to harness the benefits in the sector.

“The primary bill repeals and re-enacts the principal Nigeria Minerals and Mining Act 2007 by reworking a structure based on the priority areas. Security is one of the key factors to the stalemate of the solid minerals sector.

“Establishing mines inspection and environmental agency provides improved deeper oversight of mining activities. The agency will have offices in every state to assist with reporting and oversight. We further identified one of the lapses in security is lack of coordination between the federal and state governments,” he stated.

Gaza further revealed that the bill will bridge the gap  between the federal and state governments to empower the Mineral Resources and Environmental Management Committee (MIREMCO) to enable effective and joint oversight.

“To close the gap between federal and state governments, the bill further empowers MIREMCO to enable effective and joint oversight of the sector. It is clear that MIREMCO is poorly funded and lacks the resources it needs to support its activities.

“The bill hopes to use MIREMCO as the facilitating tool for the government to work with state governments to secure their needs to ensure formalisation of the sector.

“Community development and the environment are really prioritised in the bill. The Petroleum Industry Act (PIA) sets aside 3 per cent of their annual operational expenditure to host communities.

“In the bill, we have set aside 5 per cent of the revenue of all minerals mined to the host communities, and this is due to informality of the sector. We believe that it can be reviewed and improved through this programme.

“We also incorporated more efficient policies to enforce the environmental remediation fund to ensure that host communities are not left with deplorable sites and that the environment is adequately protected and restored after mining activities,” he added.

Earlier, the Deputy Speaker of the House of Representatives, Kalu, while declaring the public policy dialogue event open stated that insecurity, inadequate infrastructure, and lack of skilled labour had continued to act as bottlenecks hampering the growth of Nigeria’s mining sector.

Kalu said that the nation’s vast mineral resources have remained largely untapped, and undeservedly overshadowed by too much reliance on oil.

“Despite boasting over 40 commercially viable minerals, the mining sector contributes a mere 0.3 per cent to the country’s Gross Domestic Product (GDP),” he stated.

Speaking on the bill he co-sponsored with the chairman, as well as eight other mining bills, Kalu said that the bills when passed into law will represent a turning point for the nation’s mineral wealth management.

He said  that government holds many of the levers to deal with the challenges, adding that businesses have the innovation, technology, and talents to deliver the needed solutions.

“The governing philosophy in the mining sector in Nigeria should henceforth be approached with a private-sector-led lens. It is through this crucial partnership that the true potential of Nigeria’s mining sector can be unlocked.

“This public policy dialogue is engineered to create the appropriate right of way for the necessary adjustments and policymaking creativity that is required to optimise the promising prospects of Nigeria’s mining sector,” he stated.

According to him, there are indications of a renewed vigour in the mining industry, fuelled by a collective will to diversify the economy, create jobs, and unlock the immense potential that lies beneath the soil.

“The 2016-2025 mining industry development roadmap, aiming to increase the sector’s GDP contribution to 3 per cent by 2025, is already showing progress. Projects like the Segilola Gold Project in Osun state governed by a private-sector-led lens are injecting millions of dollars into our economy and attracting much-needed investment,” he added.