Nigeria’s push to unlock the full economic value of its
solid minerals gathered momentum in Abuja with the formalisation of a $1.3
billion partnership between the Federal Government and the Africa Finance
Corporation (AFC), a deal that places industrial processing and data-driven
exploration at the heart of mining sector reform.
Executed through the Solid Minerals Development Fund (SMDF),
the agreement brings together public and private capital to advance three major
initiatives: the construction of a large-scale alumina refinery, a nationwide
geoscience mapping programme, and the creation of a joint investment platform
to speed up mineral exploration and development across the country.
The flagship project under the agreement is a $1.3 billion
alumina refinery engineered to process one million tonnes of bauxite ore
annually. The plant will operate on a modern Bayer-process flowsheet and be
supported by an on-site gas-fired cogeneration facility to supply both steam
and power, enhancing efficiency and reliability.
Designed for long-term performance, the facility is expected
to run for about 20 years at 95 per cent utilisation, delivering an estimated
total output of 19 million tonnes of alumina over its operational life. This
scale positions the project as Nigeria’s largest private-sector investment in
the mining industry to date.
Beyond industrial capacity, the economic implications are
significant. Projections indicate that the project will add roughly $1.2
billion to Nigeria’s Gross Domestic Product each year, generate more than $25
billion in total economic value over its lifespan, and deliver up to $8 billion
in foreign exchange earnings.
Minister of Solid Minerals Development, Dr. Dele Alake,
described the agreement as a defining moment for the sector, noting that it
reflects the impact of recent reforms aimed at strengthening regulation,
improving investor confidence, and shifting the industry away from raw mineral
exports toward value addition.
For the SMDF, the transaction marks a historic milestone.
Executive Secretary of the Fund, Hajia Fatima Shinkafi, said the deal
represents the largest funding commitment the agency has undertaken since its
establishment, underscoring its growing capacity to participate in large-scale,
capital-intensive projects alongside international partners.
According to feasibility assessments jointly undertaken by
AFC and SMDF, the alumina project is commercially viable and globally
competitive, reinforcing Nigeria’s positioning as an emerging destination for
serious mining investment.
The agreement also extends beyond processing infrastructure.
A comprehensive geoscience mapping exercise will be carried out to generate
high-quality mineral data, reduce exploration risk, and support informed
investment decisions by international operators.
To ensure rapid translation of exploration success into
production, AFC and SMDF will establish a joint strategic investment vehicle
tasked with advancing selected mineral assets from exploration through
development and eventual production.
Permanent Secretary of the Ministry of Solid Minerals
Development, Farouk Yabo, said the initiative demonstrates the ministry’s
renewed focus on transformation and global competitiveness, adding that Nigeria
now has an opportunity to secure a stronger foothold in international mineral
markets.
Reaffirming federal commitment, Minister Alake confirmed
that all required approvals have been granted to fast-track the AFC–SMDF
investments. He also directed agencies under the ministry to prioritise the
processing of licences, permits, and regulatory clearances necessary for smooth
implementation.
The Memorandum of Understanding was signed on behalf of the
Federal Government by SMDF Executive Secretary, Hajia Fatima Shinkafi, while
Franklin Edochie, Deputy Director and Head of Metals and Mining at AFC, signed
for the corporation. The signing was witnessed by AFC President and Chief
Executive Officer, Samaila Zubairu, and the Minister of Solid Minerals
Development.
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