#1@NigeriaEITI www.neiti.gov.ng NEITI Nigeria Extractive Industries Transparency Initiative Highlights of 2021 Solid Minerals Industry Report By Orji Ogbonnaya Orji, PhD Executive Secretary/National Coordinator, EITI, Nigeria THE PRESIDENCY#2NEITE Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Focus of the Audit Theme Impact built on blocking leakages to grow revenue 12th Cycle of SM Report by NEITI @NigeriaEITI www.neiti.gov.ng#3NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY 1,214 Companies & Key Government Agencies Covered by the Report Extractive Companies 3 Nigerian Mining Cadastre Office MINISTRY OF Mines and Steel Development FEDERAL FIRS INL REVENUE Government Entities A total of 914 companies made payment of royalty out of which 121 met the materiality threshold and were responsible for 92% total royalty payment for the year. @NigeriaEITI www.neiti.gov.ng#4NEITE Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY N N L Key Highlights of the Report Total revenue generated by the sector in the year under review N193.59 billion Total revenue generated by government from the sector in 2021 2021: Increase of N60.32 billion or 51.89% N177.44 billion Financial flows to the Federation Account 2020: N116.82 billion @NigeriaEITI www.neiti.gov.ng#5NEITE Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY ☐ Key Highlights of the Report Breakdown of the Revenues as generated by the agencies FIRS N169.52 Billion N N Mining Inspectorate Department Mining Cadastre Office N4.3 Billion N3.62 Billion N1.06 Billion Company Outstanding financial liabilities to government-failure of some of the companies to pay their annual service fees for the respective mineral titles. @NigeriaEITI www.neiti.gov.ng#6Nigeria NEITE Extractive Industries Transparency Initiative THE PRESIDENCY Key Highlights of the Report Trend of Sector Contribution to FGN Receipts The sector has contributed N818.04billion (USD3.2billion) to Federal Government's receipts between 2007 and 2021 S/N Year No. of Companies FGN Receipts billion ☑ 1 2007 78 7.59 2345 2008 78 10.57 2009 78 19.15 2010 78 17.1 2011 67 27.01 6 2012 65 25.57 7 2013 65 30.25 8 2014 39 49.17 9 2015 42 64.46 10 2016 56 43.22 11 2017 59 52.76 12 2018 69 69.47 13 2019 74 79.96 14 2020 102 128.17 15 2021 121 193.59 Total 818.04 @NigeriaEITI www.neiti.gov.ng#7NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Specific Minerals Contribution by ☑ Quantity Limestone and Granite were the most produced minerals in 2021 and accounts for about 74.4% of the total production. DEERE 76.28 Million tons of minerals mined @NigeriaEITI www.neiti.gov.ng 46.68 27.72 li.. 50 45 40 35 30 25 20 15 10 5 0 Limestone Granite Aggregate 7.84 Laterite Clay#8NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY 45 37.72 40 35 30 225250 15 10 L Company by Company Quantity Production 41.38 10.95 ...I 5.65 4.29 Dangote Cement Plc Bua Cement Plc Lafarge PLC Zeberced Limited Other Companies @NigeriaEITI www.neiti.gov.ng Dangote Cement Plc, Lafarge Africa Plc, BUA and Zeberced production volume accounted for 58.61%.#9NEITI Nigeria Extractive Industries Transparency Initiative PERCENTAGE THE PRESIDENCY 25 25 22.93 21.37 20 20 15 10 5 10.52 States of the Federation Contribution to Solid Minerals Production 17.51 II......] 6.92 4.75 3.88 3.39 2.99 2.97 2.77 Ogun, Kogi, Edo, Cross River and FCT were the top solid mineral producing states in 2021 with a total contribution of 66.49% to total production volume. Oyo Sokoto Kano Domo Kaduna Rauch Benve Gongola Plateas Ogun Kogi Edo Cross FCT Benue Ebonyi Kaduna Sokoto Oyo Others River @NigeriaEITI www.neiti.gov.ng STATE Newin Bendel Cross ing Rover Rivers#10NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY NIGERIA GEO-POLITICAL ZONES Bauchi Niger FCT Plateau Kwara Nasarawa Oyo Taraba Eki Kogi Benue Ogun Canos Ond Edo Anembe Cross River Delta im BayelsaRiver Akbom Yobe Barno Contribution by Geopolitical Zones ZONES South West Zone South East Zone North West Zone North East Zone Adainwa North Central Zone ☐ 35 31.18 30.54 30 1125250 South South Zone 23.66 10.49 North-Central, South-West and South-South had the highest impact on total production with 31.2%, 30.5% & 23.7% respectively in 2021 South-East contributed the least at 0.94% contribution to production volume and 0.9% to royalty. North-Central South-West South-South North-West @NigeriaEITI www.neiti.gov.ng#11NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Issuances of Licenses (2020-2021) The details of licenses issued for the year 2020 ~ 2021 Exploration Licence (EL) 2020 2021 516 840 Mining Lease (ML) 12 40 Quarry Lease (QL) 185 255 598 Small Scale Mining Lease (SSML) 771 171 Reconnaissance Permit (RP) 139 Total 1,482 2,045 @NigeriaEITI www.neiti.gov.ng Increase of 85% in number of artisanal minerals operators to 2,336 across the country No commensurate data in production, royalty payments, exports, etc. to support this increase in operators.#12NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Solid Minerals Revenue Account Distribution to 3 tiers of Government including 13% 13% Derivation share N1.03 Billion Federal Government N3.64 Billion Derivation HL N Total revenue shared N7.94 Billion Local Government N1.42 Billion State Government N1.85 Billion @NigeriaEITI www.neiti.gov.ng S/N Beneficiary Applicable Rate % 1 Federal Government 45.83 2 State Government 23.25 3 Local Government 17.92 4 13% Derivation share 13 Total 100.00#13NEITI Nigeria Extractive Industries Transparency Initiative Copper cobalt THE PRESIDENCY Graphite NEITI Solid Minerals Report & Nigeria's Energy Transition Plan Energy Transition Minerals or the future minerals as listed below. ◉ Cobalt Lithium Nickel ◉ Copper ■ Graphite ◉ Titanium 20 exploration licenses for Lithium 30 exploration licenses for Copper respectively issued in 2021. Lithium @NigeriaEITI www.neiti.gov.ng GREEN ENERGY TRANSITION SOLAR POWER WIND POWER HYDRO POWER TIDAL POWER GEOTHERMAL POWER 11 WAVETT#14NEITIE Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Public Disclosure on Solid Minerals Contracts & Beneficial Ownership Beneficial Ownership Contracts Contracts Section 116(1) of the Nigerian Minerals and Mining Act (NMMA) 2007 provides a community Development Agreement (CDA) is signed between company and the host community. 67 CDAs out of 121 companies covered in the report were obtained and documented. NEITI website has additional information on CDAs collected during the reconciliation process. @NigeriaEITI www.neiti.gov.ng Beneficial owners of companies are natural persons who directly or indirectly own or control a corporate entity. The beneficial ownership data are publicly accessible either through the NEITI or the CAC Portal. 107 BO information were obtained out of 121 companies covered in the audit.#15NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Nigeria's Solid Minerals Exports & Destinations The total minerals exported 143,000 tons. But First patriots contributed the highest value- $44.83 Million. Export by Destination China accounted for 95% and 88% of the total export volume and value respectively Export by Mineral Type Lead ores and concentrates was the highest mineral exported, accounting for 7.7% of the total export and 35.3% FOB value. Export Destination by Value China 87.89% Malaysia 4.64% Korea 1.41% Thailand 1.17% UAE 1.11% @NigeriaEITI www.neiti.gov.ng Export Volume by Company Sino Min-metals Co. Limited Synee Alumony Mining Limited First Patriot Ltd Others 44.07% 7.19% 3.63% 45.11%#16NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Contribution of the Sector to the Economy 0.63% Contribution to GDP Nigeria's GDP in 2021 was N173.53 trillion Contribution of the Solid minerals sector N1.10 trillion @NigeriaEITI www.neiti.gov.ng N 0.24% Contribution to Export The value of Nigeria's export in 2021 was N18,200 billion. Solid minerals sector contribution was N43.68 billion 2.62% Contribution to government revenue The federal government revenue collection N6.63 trillion. Solid minerals sector contribution - N173.98 billion#17Nigeria Extractive NEITE + Industries Transparency Initiative THE PRESIDENCY Key Findings and Recommendations The report made a total of 44 findings & recommendations from Page 76 -94 of the report covering the following areas: Regulation issues ☐ Financial Issues Environmental Issues Process Issues ☐ Production Volume management Revenue Generation ☐ Global emerging development issues in the Solid Minerals sector @NigeriaEITI www.neiti.gov.ng#18Nigeria Extractive NEITE > Industries Transparency Initiative THE PRESIDENCY 1 Key Findings and Recommendations Findings The total revenue from the sector over the last fifteen years (2007 - 2021) was 814.59bn. This amount is significantly low compared to the economic potential of the sector. Recommendation The FGN through the MMSD should establish a Special Purpose Vehicle (SPV) dedicated to de-risking the solid minerals sector value chain. Furthermore, the MMSD and MCO should constantly engage with the relevant stakeholders to sustain conducive environment for investments and revenue growth in the sector. @NigeriaEITI www.neiti.gov.ng#19NEITI Nigeria Extractive Industries Transparency Initiative 4 5 THE PRESIDENCY Findings Key Findings and Recommendations The report noted a significant variance of 38,145.85 tons between solid minerals export data reported by NCS and MMSD-MID. This variance is as a result of non-collaboration between the NCS and MMSD. Recommendation MMSD-MID's collaboration with the NCS on the issue of export permit. The NCS should enforce compliance on export permits from MID prior to mineral export. This report has found that the signed CDAs in the custody of the MMSD (MECD) are not publicly accessible. Host all signed CDAs on MMSD website to make them easily accessible to the public. @NigeriaEITI www.neiti.gov.ng#20NEITI Nigeria Extractive Industries Transparency Initiative 6 THE PRESIDENCY Findings Key Findings and Recommendations Recommendation This report noted an emerging phase in the The FGN should collaborate with relevant stakeholders to ensure mining sector - Nigeria Energy Transition that the Energy Transition Plan (ETP) is consciously implemented. Plan, which seeks to create significant investment opportunities for establishment and expansion of industries related to solar energy, hydrogen, and electric vehicles. the @NigeriaEITI www.neiti.gov.ng#21NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Findings Key Findings and Recommendations Recommendation 7 Only 39 out of 121 companies made the The MMSD and MCO should collaborate on a framework for monitoring compliance mandatory social payments as contained with the terms of MMA 2007 and MMR 2011 and impose appropriate penalties on in the CDA signed with their host defaulters. communities while 10 companies made only non -mandatory social payments/expenditures. This reveals poor compliance to the social benefit to host communities' requirements of the NMMA 2007 and NMMR 2011 as embedded in the CDA's. @NigeriaEITI www.neiti.gov.ng#22NEITI Nigeria Extractive Industries Transparency Initiative THE PRESIDENCY Thank you @NigeriaEITI www.neiti.gov.ng