The Federal Executive Council (FEC) on Wednesday approved N30 billion intervention fund for mining exploration in the country.
The Minister of Mining and Steel Development, Kayode Fayemi disclosed this to State House correspondents at the end of FEC meeting presided by President Muhammadu Buhari.
He was accompanied by the Minister of Information, Lai Mohammed and Minister of Transport, Rotimi Amaechi.
Fayemi said that the fund that will come from 1.68% of the Federation Account will mainly focus on mining exploration.
He said: “FEC rectified the president’s anticipatory approval for Ministry of Mines and Steel Development to qualify to access the national resources fund.
“You will recall that in August FEC approved the road map for the growth and development of the mining sector.
“In recognition of Mr. President’s campaigns promises to Nigerians and in particular his consistent statement to diversification particularly in agriculture and mining sector, Council ratified the approval of N30 billion intervention fund for the mining sector. It will be highly focused on exploration. Exploration is the heart of mining, if you don’t search you won’t find.
“You have heard all sorts of talks about how rich Nigeria is in mineral resources but the quantity, quality, the geological prospectively has been a challenge because we have neglected the sector for such a long time.” He said
He also said that there is need for investment grade geological data if Nigeria must attract mining investment into the country.
According to him, smaller countries like Burkina Faso spend averagely $300 million a year on exploration.
He added: “This is why Council approved this for mining and this is significant because this is the accessing of natural source development fund which has been made 1.68 per cent of the federation account. It is an equivalent of the ecological fund and the Education Trust Fund.
“It is meant primarily for agriculture sector, mining sector and the water resources sector. And this will cover exploration primarily but also research and development in partnership with our universities, it will also cover security and mining in partnership with the ministries of Interior and Defence and the DSS just to tackle the menace of illegal mining across the country. It will also support small scale miners with grants,” he stated
The Council, he said, also stressed the importance of inter-ministerial coordination and for the Ministry to work with the ministries of transportation, power, works and housing, environment on safer mining practices and ministry of health to help build a multi-sectoral focus on mining and also encourage private sector investment in the sector.
He said that the government is already in negotiation with sovereign investment on mining in order to access private capital to mining and the Nigerian Stock Exchange.
The guidelines, he said, will be ready in a month’s time.
Amaechi disclosed that the Council approved advisers that would sit to negotiate with General Electric (GE) towards concessioning the railway.
He said: “For the Transport sector I’m sure you are aware of an attempt to concessioned the Railway to General Electric (GE), Council approved the advisers that would sit with GE as our own experts to negotiate.
“The narrow Gauge railway will to a great extent assist the agriculture, mines and steel development ministries in the transportation of the extracted minerals. We are rehabilitating at no cost to government the Port Harcourt-Maiduguri, which include Port Harcourt, Aba, Umuahia, Enugu, Makurdi, Jos, Gombe, Bauchi to Borno.
“Then Lagos to Kano will include Lagos, Abeokuta, Ibadan, Ilorin, Kano, Funtua, Zaria and to Kaura Namoda, we are rehabilitating all of them.
“It is essentially to encourage freight movement, we have over 30 million worth of freight on the Lagos Kano route for which presently we are moving slightly above 100 tones. While the Port Harcourt to Maiduguri is currently moving nothing but we are anticipating 11 million tones that can be moved from Port Harcourt to Maiduguri.” He said
According to him, the rehabilitation will encourage movement of cargos and passengers.
He said that GE will do everything required to rehabilitate and invest on other railway infrastructure.
“GE is proposing to manage for 25 years to recover their investments. Nigerian government has not agreed and that is what our advisers will sit with GE to agree,” he added.
The advisers, he said, included African finance corporations.