Ogun tops the table as Nigeria earned N43.2bn from solid minerals in 2016
Abuja, November 13, 2018 (AltAfrica)-The solid minerals sector of Nigeria contributed a total sum of N43.22 billion to the coffers of the federation in 2016, an audit report done on the operations of the sector within the period by the Nigeria Extractive Industries Transparency Initiative (NEITI) has shown.
In its breakdown of the report, NEITI on Tuesday said taxes collected by the Federal Inland Revenue Service (FIRS) in this regard accounted for N40.38 billion or 93.43 per cent of the revenue, while fees collected by the Mining Cadastral Office (MCO) stood at N1.15 billion or 2.66 per cent.
It equally explained that the Mining Inspectorate Department (MID) recorded N1.64 billion as royalty payments, which represented an increase of 30.15 per cent over the N1.27 billion reported as royalty payments in 2015.
NEITI stated that the audit was conducted under the principles and standard of the global Extractive Industries Transparency Initiatives (EITI) and that it reconciled payments made by solid minerals mining companies in terms of taxes; royalty; and rents against receipts of such payments by relevant government agencies.
From the report, NEITI noted that the total volume of minerals produced in 2016 was 41.87 million tonnes valued at N34.09 billion representing 33 per cent increase on the N25.56 billion reported in 2015.
It however stated that tax collection and payment of other fees for 2016 reduced by 32 per cent when compared to the figure of N63.98 billion for 2015.
The report further disclosed that while 651 extractive companies made royalty payments in 2016, only 56 companies, which met the materiality threshold of N3 million and above, were considered for reconciliation. The companies that met this threshold, it noted, accounted for 86.87 per cent of the total royalties paid.
On state-by-state minerals production, NEITI stated that Ogun State contributed 33.49 per cent to the total production to top the table, followed by Kogi State with a contribution of 19.7 per cent, while the Federal Capital Territory (FCT) produced 6.20 per cent of the volumes.
From the report, NEITI equally stated that minerals production by companies showed that three companies — Dangote Cement Plc, West African Portland Cement Plc, and United Cement Company of Nigeria Limited (UNICEM) — contributed 70 per cent of total production in 2016.
It said this showed that the cement sub-sector was dominant in solid minerals production activities in Nigeria.
Further analysis of production by minerals types by the NEITI report showed that limestone was the most produced mineral and accounted for 49.35 per cent of the total solid minerals production in 2016, followed by granite with 31.32 per cent.
From the report, China was a major destination of Nigeria’s solid minerals in 2016, accounting for 53.63 per cent, followed by Spain and India which accounted for 26.48 per cent and 8.90 per cent respectively.
The report put the Free on Board (FOB) value of the solid minerals exported in 2016 at $40.934 million while the overall contribution of the sector to the country’s Gross Domestic Product (GDP) was put at N87.61 billion representing 0.13 per cent of the total GDP of N67.9 trillion.
It said the sector has witnessed a steady but marginal increase in its contribution to the national GDP from 0.11 per cent in 2014, 0.12 per cent in 2015 to 0.13 per cent in 2016, adding that it also contributed 0.3 per cent to national employment in 2016.
According to the report, the sum of N9.923 billion was shared by the three tiers of government in 2016, being the accumulated revenues from 2007 to 2014 from the solid minerals sector, with the federal government getting N4.547 billion, while states and local governments shared N2.306 billion and N1.778 billion respectively. The sum of N1.289 billion was also shared as derivation.