MINING AND THE CHALLENGE OF SMALL AND MEDIUM
SCALE ENTERPRISES DEVELOPMENT IN NIGERIA
BEING THE TEXT OF A PAPER PRESENTED BY
ALHAJI SANUSI MAIJAMA’A
NIGERIAN ASSOCIATION OF SMALL SCALE INDUSTRIALISTS
AT THE INTERNATIONAL MINING INVESTMENT CONFERENCE /
EXHIBITION ON NIGERIA (IMICON 2006)
ORGANIZED BY MINERAL WATCH CONSULT LTD. IN COLLABORATION WITH
ICTC INC. CANADA
HELD AT THE TRANSCORP HILTON HOTEL, ABUJA, NIGERIA,
JUNE 13-15, 2006.
MINING AND THE CHALLENGE OF SMALL AND MEDIUM
SCALE ENTERPRISES DEVELOPMENT IN NIGERIA.
There could be no better time to discuss the topic “Mining and the
Challenge of Small and Medium Scale Enterprises Development in Nigeria” than now, in view of the emphasis of the Obasanjo Administration
on increased productivity in the non-oil sector of the national economy.
I, therefore, command the initiative of the organizers of this Conference / Exhibition, their foresightedness and patriotism forwards nation-buiilding and sustainable economic development. It is my hope that the objective of this deliberation will be achieved and the impart felt in greater dimension.
Rather than dwell on definitions of “mining” and the key words of the above theme and topic, I would prefer to illustrate mining with and example of limestone / marble exploitation in relation to other numerous solid minerals in various parts of Nigeria: and the activities of the Raw Materials Research and Development Council as well as some guidelines (requirements) vis-à-vis “Entry into Mining Industry” issued by the Ministry of Solid
Minerals Development. Thereafter , I shall highlight some Challenges of the small and Medium Scale Enterprises Development in Nigeria, and conclude by making some recommendations.
Nature has, indeed, blessed Nigeria with abundant mineral deposits as well as human resources. There is every necessity to exploit and process the natural resources to serve the economic needs of the nation and export the surplus to earn foreign exchange.
THE ROLE OF GOVERNEMTN IN THE MINING INDUSTRY
The Federal Government policy on Mining Minerals Deposits in the country is yet to be made available to small scale industrialists. Perhaps, some industrialists are aware of the contents but a considerable number of small scale industrialists have no knowledge of such policy. Information dissemination on Government policy and programme in that sector is vital in order to maximize the benefits of such activities.
Nevertheless, one of the positive steps taken by the Federal Government was the establishment of the Raw Materials Research and Development Council. The major objectives of the Mineral Exploration and Development Programme of RMRDC aim at:
- Stimulating interest and generating awareness in Solid Minerals.
- Facilitating increase in the production of various mineral raw
materials for industrial utilization.
One of the methods through which the programme is being pursued is the production of Technical Briefs on each mineral in the country.
The production of the briefs involves collection, collation and synthesis of available information on reserves, processing, market, etc on each mineral into a technical brief or handbook.
The technical brief on, for example, limestone / marble, is reported to be the twelfth in the series. The brief outlines the sourcing, industrial uses and other available technical information in limestone / marble within the country.
For general information, limestone is a sedimentary rock composed dominantly of carbonate minerals, principally carbonates of calcium and magnesium. Marble is the metamorphosed crystalline equivalent of the limestone.
Limestone / Marble are carbonate rocks, dominated by the mineral calcite (CaCO3)
They are extremely valuable industrial mineral raw materials. Construction and cement Manufacturing Industries are principal consumers. They are also used in the production of chemicals, fertilizer, abrasives, industrials fillers, glass, ceramics, etc.
Limestone and marble occur throughout Nigeria in both basement rocks and in sedimentary basins. The eight cement plants in the country are located near quarries of suitable limestone or marble deposits. Limestone, marble and dolomite in Nigeria may be conveniently grouped into three classes on the basis of geological age, as follows:
- Precambrian marble,
- Cretaceous limestone; and
- Tertiary limestone
The Precambrian limestone, which has been re-crystallized to form marble, are confined within the schist belts of the western half of Nigeria, west of longitude 8 E. They contain variable amounts of mica, calcilicates and sometimes, small inclusions of gneiss, pegmatite and quartz as reaction products. These deposits are being used mainly for paladina crushed stone aggregate, and lime (Jakura Marble). The Ukpilla deposit in Edo state is presently being used for the manufacture of cement and calcium carbide. Other marble deposits are Igbetti, Oyo state; Ekinrin Adde, Kogi state; Ubo, Edo state; Itobe, Benue state etc. Five major marble deposits that are current being exploited in the schist belt area have an estimated reserve of about 150million tons. The lensoidal shape of these desposits suggest that many more occurrences may yet be discovered in the schist belts.
The sedimentary limestone of cretaceous and tertiary ages are associated with shale, siltstone, and fine-grained sandstone. They are often hard, gray and shelly. The cretaceous varieties occur in a wide belt of territory which, extends from Calabar in the South south, through Agila, Igumala and Yandev in the Central Nigeria to Ashaka and Gombe in the northeast of the country.
The tertiary beds sometimes contain limestone and inter-bedded marbles. Total estimated resources of these varieties are about 200 million tones. They occur in Shagamu, Ewekoro, and Sokoto where they are being exploited for cement manufacture.
Most of the deposits being exploited by the cement industry have varied compositions, which range from about 81% CaCO3 in Sokoto to about 96% CaCO3 in Mfamosing. Dolomite (Mg.Ca) (CO3) values range from about 0.5% in the Mfamosing limestone to about 4.6% in the UKpilla marble. Except in a few cases, the contents of phosphates, sulphur and iron are in trace amounts only.
Time constraint may not permit me to reproduce the tables showing some limestone and marble deposits/occurrence in the country as well as annual production figure for limestone/marble between 1994-1995 in Nigeria for the purpose of challenging small and medium scale industrialists. It suffices to state that the market potentials of limestone/marble in Nigeria is large.
However, it should be mentioned that the supplies of these materials are far less than the demand. Ordinary Portland cement production in the country stands at 2.8million tons per annum, which is far less than 50% of the annual national demand.
Also the supply of processed or granulated limestone/marble to relevant era-users has not met demand.
In order to meet the demand, there is need for further investigation of various deposits so as to group them according to grades and specific industrial uses for which they are most suited. There is among investment opportunity in limestone/marble development and processing.
INVITATION FOR THE EXPLOITATION OF IDENTIFIED
LIVESTONE DEPOSITS IN NIGERIA
In view of the above observation by RMRDC in their
Technical Brief on minerals in Nigeria limestone marble,
November, 2001 the attention of stakeholders/investors in
the mining industry is hereby invited to the uncompleted
investigation and exploitation of the limestone deposit at
Ohafia/Arochukwu, Abia State, Southeast of Nigeria, among
others, which was reported as “Not yet quantified”.
Professor M. O. Ijere and Professor K. Mosto Onuoha,
University of Nigeria, Nsuka, in 1980, pointed out that
“preliminary studies conducted so far in parts of Imo State
(now Abia State-Ohafia/Arochukwu LGAs) indicate a surface
and subsurface abundance of two major limestone areas
which are repeated from each other by coat-bearing
formations. The areas concerned are covered by parts of the
geological surveys of Nigeria (G.S.M) topographical sheets
“Afikpo South East and South West Ikot Ekpene North East
and North West”. The preliminary investigations reveal that
the limestone deposit belong to at least four different
formations. If may be important to note that the Ewekoro
limestone quarried in Western Nigeria by the West African
Portland current CA. Ltd. has probably is equivalent in age
and lithology in the above mentioned areas.
A large number of local outcrops belonging to the “Upper
and Lower coal measures” has been found in these same
areas. The geological succession is similar to that around
Enugu where fire economically important coal seams occur.
It seems that the various geological formations in the areas
covered by the mentioned topographical shhets occupy the
same position in relation to the Enugu escarpment.
There is therefore a need to conduct detailed geological and
geophysical investigations in the areas covered by these
topographical sheets. Such detailed investigations would
buttress the preliminary results and should bring forth data
of great economic important, the report concluded.
GUIDELINES ON “ENTRY INTO MINING INDUSTRY
(REQUIREMENTS) BY MINISTRY OF SOLID MINERALS
i. Copy of CV are copy of degree certificate of a Mining
Engineer or a Mining Technologist or Geologist with
requisite mining experience to be in charge of technical
ii. Statement of Account of the company of not less than
N3 million to show financial capability of the company. iii. Banker’s Guarantee to the tone of N1 million as
prescribed on form “K” which serves as security from
operator to pay adequate compensation to owner of the
land to be disturbed.
iv. Copy of certificate of incorporation of the company.
v. Copy of true certificate copy of memorandum and
Articles of Association duly stamped duty. vi. Copy of Evidence of civic responsibility inform of tax
vii. Evidence of payment of prescribed fee of N20,000.00
PROSPECTING RIGHT (PR) REQUIREMENTS
i. Report of proposed programme of prospecting which
include detailed programme of progressive reclamation
and rehabilitation of land to be disturbed.
ii. Copy of CV and a copy of Degree Certificate of a Mining
Engineer or Mining Technologist or Geologist with
requisite mining experience to be incharge of technical
iii. Copy of letter of appointment of mining engineer or a
iv. Copy of acceptance letter of appointment of Mining
Engineer or Geologist.
v. Evidence of application fees paid depending in the type
? Precious metal, eg. Gold etc. N25,000.00
? Gemstones, eg. Sapphire etc. N25,000.00
? Metallic minerals, eg. Tatalite, etc N12,000.00 ? Non-metallic minerals, e.g. Baryte, etc. N10,000.00 ? Carbonaceous, e.g. coal, etc. N50,000.00 ? Lignite N25,000.00
EXCLUSIVE PROPECTING LICENCE (EPL)
i. Copy of current prospecting right license.
ii. Report of proposed programme of prospecting including
detailed programme of progressive reclamation and
rehabilitation of card to be disturbed. iii. Favourable survey report from the office of the
surveyor general of the state. iv. Favourable forestry report from the Ministry of
Agriculture of the State.
v. Administrative/Political report from the Chairman of the
Local Government Area or any other authorized agency.
vi. Consert letter from the land owner.
vii. Evidence of prescribed fee of N10,000.00 paid.
MINING LEASE (ML) REQUIREMENTS
i. Submission of site plan
ii. Report of proposed programme of prospecting including
detailed of programme of progressive reclamation and
rehabilitation of land to be disturbed. iii. Copy of company’s certificate of incorporation.
iv. Copy of the company’s memorandum and Articles of
v. Copy of the prospecting plan of the area.
vii. Copy of current prospecting right
viii. Evidence of Prescribed fee of N10,00,00 paid.
QUARRYING LEASE (QLS) APPLICATION
i. Submission site plan.
ii. Administrative, Forestry and Surveyor General Reparts
of the area.
iii. Company’s certificate of incorporation.
iv. Copy of company’s Memorandum and Articles of
v. Consert letter from land owner.
vi. Evidence of Prescribed fee of N10,000.00 paid.
QUARRYING LICENCE (QLC) APPLICATION
i. Evidence of Endorsement by the local authority to
ensure paper acquisition of land. ii. Submission of the sketch plan of the area to the
Federal mines Officer.
iii. Evidence of prescribed fee of N5,000.00 paid.
CHALLENGE OF SMALL AND MEDUIM SCALE
It is obvious from the above account that entry of small and
medium scale entrepreneur into the mining industry poses
The project is not only capital intensive, the requirements
demand very serious commitment determination and
persistence on the part of the entrepreneur.
Some of the challenges that militate against the small and
medium scale industrialists in pans-----mining projects
i. Lack of financial capacity as accessing loan through the
bank is like a camel passing though the eye of a needs. ii. Lack of information on Government policy and
opportunities that exist in the mining industry for small
and medium scale industrialists. iii. Inadequate information on sources of obtaining mining
equipment and other necessary imports as well as
iv. Inadequate sensitization of the small and medium scale
industrialists by Government Agencies on their
activities and programmes that are relevant to their
v. Available research and development documentations
not mobilized among small and medium entrepreneur.
RECOMMENDATION AND CONCLUSION
The need to ensure coordination, monitoring and evaluation
in view of activities in mining ventures, it is hereby
suggested that government should establish implementing
Agencies on mining industry in order to ensure effective
implementation of existing policies on mining and revision of
the policy in line with present economic and industrialization
realities. A natural Advisory Board and National Council on Mining in Nigeria are desirable and should be established; or strengthened to be all-embracing if any exist(s). The Boards should include representatives of the National Association of small scale industrialists Nigeria Association of Women Miners and other stakeholders in the mining industry.
Considering the fact that grassroots miners have no access to funding, it is recommended that micro finance facilities should be extended to Mining cooperatives who have been constituted into clusters according to specific mineral sectors through the Nigeria Association of small scale industrialists (NASSI) as an umbrella organization, including the Nigerian Association of women miners, which also has women in mining cooperatives as members.
There should be established, specifically, National Mining Fund and National Mining Financing Agency for obvious advantages in the accelerated development of the mining industry in Nigeria.
In consideration of the high risks involved in mining ventures, Government should establish Mining Insurance and Re-Insurance Board in order to ensure the provision of Insurance Guarantee Scheme incentives to miners. Basically, the establishment of a National Mining Insurance Company is urgently required.
In order to create wider markets for solid minerals, there should be public-private sector collaboration in organizing Exhibitions/Export promotions through trade fairs-National and International-with a view to exposing miners products to buyers.
For the purpose of capacity building, there should be organized regularly workshops, seminars, skills Acquisition Training Programmes as well as sensitization and