The Minister of Solid Minerals, Oladele Alake, has hailed the $1 billion (N1.6 trillion) iron ore-to-steel project in Kogi State as a major breakthrough in the Federal Government’s push for local value addition in the mining sector. This initiative is a key aspect of the federal government projects, which focus on processing minerals domestically rather than exporting raw materials.
Collaboration with Chinese Partners
The project is a collaboration between Nigeria’s Chart and Capstone Integrated Limited and China’s Sinomach-He. Special Adviser to the Minister, Kehinde Bamigbetan, disclosed this development, emphasizing its importance in President Bola Tinubu’s recent trip to China. Alake praised the project as a pivotal step in the government’s efforts to revitalize the mining and steel sectors.
Shift in Mining Policy
The new project supports the Federal Government’s reversal of the “pit to port” policy, which previously allowed mining companies to export raw minerals. Under the new initiative, companies are required to include plans for local processing of minerals in their mining license applications, thereby creating jobs, transferring skills, and improving Nigeria’s trade balance, particularly with China.
Alake in his statement noted that the current trade imbalance with China, valued at over $1 billion in China’s favor, is largely due to Nigeria exporting raw minerals. He emphasized that by exporting value-added mineral products, Nigeria will improve its trade balance and increase foreign exchange earnings. This strategy is also expected to reduce the country’s debt burden over time.
Streamlined Licensing and Industrialization Goals
Chief Abel Edijala, CEO of Chart and Capstone Integrated Limited, praised the Federal Government’s streamlined license application process, noting that the company’s exploration license was approved without delays. Edijala also stressed that the project aims to integrate iron ore mining with steel manufacturing, boosting Nigeria’s industrialization. He called for tax waivers to ease the project’s initial stages.
Support from the Nigerian Embassy
Nigeria’s Consul-General to China, Ambassador Gbadebo Afolabi, endorsed the partnership after confirming Sinomach-He’s credibility through due diligence conducted by the Nigerian Embassy. This endorsement strengthens confidence in the project’s success and its potential to significantly impact Nigeria’s industrial and economic landscape.
