Dele Alake, who was appointed Nigeria’s solid minerals minister last August, was among those considered for the position of chief of staff because of his closeness to President Bola Tinubu whom he has worked with for over 30 years. When Tinubu was governor of Lagos between 1999 and 2007, he served in Tinubu’s cabinet, leading the communications and strategy docket.

Today, he has been given the task of reviving Nigeria’s solid minerals sector hitherto an economic backwater and he is hoping to push through quick reforms through his close relationship with the president.

A government report says the value of the solid minerals underneath Nigeria’s soil is valued at over $750bn with the country having an abundance of lithium, gold, bitumen, coal, iron ore, gemstones and 34 others.

Yet, the government’s 2023 report on the sector shows that the solid mineral contribution to Nigeria’s GDP stands at 1.8%, generating only $1.4bn in the 13 years preceding the report while the oil sector brought in about $400bn within the same period. But the Nigerian government says it is reviving the solid minerals sector.

Alake tells The Africa Report that since developed nations are moving away from fossil fuel because of the need to embrace green energy, the solid mineral sector is well positioned to take on new investments.

“There is a tendency for revenue coming from oil to start reducing and you know Nigeria operates a mono-cultural economy which is solely dependent on oil.

“For our own economic survival, we saw the wisdom in diversifying the economy away from oil and where are the critical areas in the economy to divert to? Solid minerals,” he says.

Alake is very bullish on lithium, which is used in manufacturing batteries for electric cars.

Recently, a Chinese firm, Avatar New Energy Materials, inaugurated a $100m lithium factory with a capacity of 4,000 tonnes per day in Nasarawa, next-door to Abuja, the nation’s capital.

He believes strongly that this is just the beginning of bigger things to come.

“What we are seeing on the horizon is very positive. My target is to ensure that the solid minerals sector overtakes the oil industry in terms of its contribution to the economy,” Alake says.

If we are serious about opening up solid minerals, we must invite the big players…

Despite investments coming in from the Chinese, funding in the sector remains rather low. The minister argues that Nigeria needs to attract companies like Glencore, which have the capacity to undertake huge investments.

“Now take the oil sector for instance you have the big players like Exxon, Mobil, Texaco, Chevron and all that. If we are serious about opening up solid minerals, we must invite the big players because they have the financial capacity and they bring the FDI into the country to shore up our economy,” Alake says.

The minister, however, notes that measures are also being put in place to ensure that host communities are protected in order to prevent agitations like the one in the Niger Delta which nearly crippled the oil sector.

“Going forward even if you apply for a licence now, you must put in place as part of the requirement, your remedial plans in case you leave the mine, what plans you have in ensuring the covering of pits and mines and even ensuring that your operations comply with regulations.”

Africa Mineral Strategy Group

Alake is also very big on value addition and has continued with a government policy which prohibits the exportation of solid minerals in their raw form.

Two years ago, the Nigerian government blocked a request from Elon Musk’s Tesla to mine lithium because the vehicle manufacturer could not commit to building a battery manufacturing facility.

…some presidents have started implementing it. Museveni of Uganda just did it recently…

Alake, who is the chairman of the newly established Africa Mineral Strategy Group – a coalition of ministers of mining in 16 African countries –  says Nigeria is now championing the adoption of this value addition policy across Africa.

“It [value addition] resonated with other people, especially other African ministers of solid minerals. They bought into it and as we speak, many countries are now making it a cardinal policy in the mineral sector,” he says. “In fact, some presidents have started implementing it. Museveni of Uganda just did it recently, banning the exportation of raw materials out of the country.”

Tinubu accuses global community

However, Alake admits that investors will not come in until there are far-reaching reforms, a reason he launched a seven-point agenda of which fighting insecurity is the most vital. The parts of Nigeria where the most precious solid minerals are found are also among the most affected by insecurity. This includes Zamfara, Nasarawa, Niger, Sokoto, and Kaduna.

At a security stakeholder meeting last month, Tinubu accused the global community of being responsible for the disturbing rise in illegal mining, illicit funds flow and terrorism funding in Africa.

To combat illegal mining, Alake launched a mining marshal drawn from the civil defence corps. These 2000 officers trained by the Nigerian military have now been stationed in some hotspots and have been making arrests in recent times, Alake says.

“We are also making arrangements to procure satellite surveillance gadgets that will enable us to see operations in all mining sites in the country so that we can efficiently deploy forces to areas that have problems or to flashpoint areas or where nefarious activities are taking place,” he says.

Another NNPC?

Alake says plans are also underway to establish a national mining company through which the Nigerian government would become a player in the sector and can enter into joint ventures with mining companies just as Nigeria’s national oil firm – the NNPC – is involved in joint ventures with oil majors.

This has come with mixed feelings because of the bloated public sector in Nigeria. A bill is already before Nigeria’s parliament on the establishment of this company, which he says will eventually be listed on the stock exchange.

The equity structure will be like 50% [for the] private sector and then 25% for members of the public…

It will be similar to the “NNPC for the mineral sector, but the structure is going to be vastly different. The equity structure will be 50% [for the] private sector and then 25% for members of the public, who are also [in the] private sector and then 25% for the government”, Alake says.

Intra-African trade

Alake is hopeful that a collective policy on value addition would boost African trade in the long-run. But first, he adds, Africa must complete regional road networks like the Lagos-Abidjan expressway before such intra-African trade can be seamless.

“If we are no longer allowing the exportation of our raw materials away from Africa, then definitely we will force operators or investors to begin processing locally or refining,” he says. “And when they process or refine and they make batteries and all that, it then becomes essential for intra-African trade to take place because there is a platform for them.”