Growth & Gaps: The Next Test For Nigeria’s Mining Reforms

By AUGUSTINA McSOLOMON-OGHAKPERUO

Focus: Sector Challenges & the Road Ahead

Revenue Growth Masks Structural Hurdles

NIGERIA’S solid minerals sector is showing robust revenue growth, escalating from ₦16 billion in 2023 to an expected ₦70 billion by the close of 2025—a performance enhanced by targeted reforms under Minister Dr. Dele Alake’s 7-Point Agenda. But behind the headline numbers lie ongoing challenges that will determine whether the growth is sustainable.

Reform Gains and Compliance Enforcement

A cornerstone of the ministry’s turnaround strategy has been improving regulatory discipline. Authorities revoked more than 2,500 inactive or non-compliant licences over two years, a move intended to weed out speculative holders and make mineral assets productive. Strengthened Community Development Agreements also aim to ensure that host communities are stakeholders in—and beneficiaries of—mining activities.

To suppress illegal mining, which erodes state revenues and damages ecosystems, the ministry deployed mining marshals in 2024. This enforcement arm has made tangible headway, securing nearly 100 shut-down sites and prosecuting operators who flouted mining laws.

Satellite Surveillance: The Next Enforcement Frontier

Looking ahead, the ministry plans to introduce nationwide satellite monitoring of mining activities starting in 2026. Officials say the system will offer real-time oversight, strengthen compliance verification, reduce illegal extraction, and protect strategic mineral deposits.

Investment and Industrial Capacity Building

The sector’s revenue swell has attracted significant foreign capital: around $1.5 billion in FDI since 2023. This infusion supports industrial projects including multiple lithium processing plants and a $400 million rare-earth metals facility, anticipated to diversify Nigeria’s export base and create upstream and downstream value-chain employment.

Underlying Challenges Remain

Despite these gains, experts caution that revenue alone does not guarantee a thriving sector. Persistent challenges include:

• Environmental degradation from artisanal mining

• Community tensions where benefits lag impact

• Limited access to capital for local mining entrepreneurs

• Policy consistency across administrations

The ministry’s cooperative federalism approach—encouraging states to hold licences and participate in mining ventures—represents a strategic effort to broaden ownership and governance participation, particularly in mineral-rich states like Nasarawa, Kaduna and Oyo.

Balancing Growth with Sustainability

Officials and industry stakeholders stress that the reforms’ long-term success hinges on deepening transparency, strengthening institutional capacity, and ensuring that revenue gains translate into job creation, technology transfer, and environmental stewardship.

As the sector moves into a phase of industrial scaling and international competition for critical minerals, Nigeria’s experience could offer a model for other African mineral economies seeking to convert resource wealth into shared, sustainable wealth.