Nigeria’s emerging minerals and mining sector operates at the intersection of investment promotion and legitimate public objectives, including resource development, community interests, environmental protection and wider economic development of the country. The proposition for mining investors is changing. Policy is increasingly focused not simply on extracting minerals, but on retaining more value through processing, infrastructure and regional value chains.
The recently signed Continental Integration and Economic Assurance Declaration (CIEAD) in New York appears to reinforce that direction. Its full text, however, has not yet been publicly released. For now, investors should treat CIEAD as an important policy signal, not as a published rulebook, and focus on the commercial implications of the themes emerging from the New York discussions.
Four questions matter now: Can the project operate profitably under the emerging value-addition model? Can the expanded project be financed? How should the investment be protected? And where are disputes most likely to arise?
1. Operations – The Mine Is No Longer the Whole Project
Nigeria’s mining sector remains principally governed by the Nigerian Minerals and Mining Act 2007 (the “Act”) and the Nigerian Minerals and Mining Regulations 2011. The framework covers mineral titles, environmental obligations, community relations and the development and operation of mines.
Current policy increasingly favours beneficiation and local value addition before critical minerals are exported. How that applies to a particular project may depend on its mineral title conditions, approved work programmes and undertakings. The Act does not currently prescribe a general value-addition threshold; however, proposed amendments to the Raw Materials Research and Development Council legislation would, if enacted in their current form, introduce a generally
applicable 30% value-addition requirement before raw materials may be exported.
The commercial implication is that a lithium, tantalite or other critical-minerals project should be stress-tested against the processing and value-addition requirements that may apply to it over its life. Feasibility work should examine applicable project requirements, the availability and cost of power and water, processing technology and options (including joint ventures with existing processors), transportation capacity, product specifications and the compatibility of offtake arrangements with alternative processing scenarios.
