FG raises rates and fees for all mining sector activities

The federal government has raised rates and fees for all mining activities.

The decision was made after concerns were raised about the non-remittance of revenues by some operators, stating that while mining operators generate significant profits, they do not remit them to the federal government.

Dr Dele Alake, Minister of Mineral Resources Development, disclosed this during a press conference in Abuja on Thursday.

The Minister stated that this development is due to the introduction of recently implemented quality measures. He added that this will raise the level of services, increase transaction traffic and improve infrastructure development.

He said, “Today we are taking an important step towards implementing the seven-point program.”

“This is to prepare the sector for economic consolidation by announcing a new system of rates and fees for various services of the department and agencies of the ministry.”

“For example, we oversaw the successful implementation and completion of the Mineral Sector Support Project for Economic Diversification.”

Alake said the new system would encourage greater interest and increase participation in the sector, thereby giving stakeholders the confidence to invest. He mentioned that the Nigerian Geological Survey Agency (NGSA) has acquired integrated baseline data that is available to the general public.

New license rates

Alake noted that the rate system includes some 268 items, making it difficult to discuss each one individually.

He said, “Stakeholders benefit from the mining sector; therefore, it is only right that those who invest in and profit from the mining sector should be at the forefront of government action to recoup profits rather than passing them on to poor Nigerians.”

“The cost of obtaining an Exploration Concession (EL) is N600,000 for the first 100 cadastral units.”

“The aim is to discourage speculation and address the lack of funds that limit the ability of the federal government to facilitate business in this sector.”

The new rate, which covers 268 positions in the industry, for the first time includes an annual service fee of N31,500.

“Also N260,000 for Small-Scale Mining License (SSML), N500,000 for quarry lease and N1,250,000 for companies operating under mining lease. Upon renewal of the license, the rates for each category will be N42,000,”

New license fee rates

• Alake said the new regulations aim to maximise royalties from mining key minerals such as lithium and gold, which will increase state revenues and make a significant contribution to economic development.
• He mentioned that under the new rates, lithium ore (lepidolite), which currently has a market value of N600,000 per tonne, is subject to a royalty of N18,000 per tonne.
• Kunzite, valued at N3 million per tonne, is subject to a royalty of N90,000 per tonne, while spodumene lithium ore, valued at N316,667 per tonne, is subject to a royalty of N9,500 per tonne.
• He also noted that the rate review applies to services provided by the Mining Cadastre Office (MCO) and the Nigerian Geological Survey Agency (NGSA). According to Alake, the new rate system is effective immediately.