Citing the untapped potential of Nigeria’s Gold market, stakeholders in the value-chain have sought increased involvement of investors in the £4 billion or N1.85 trillion (£1: N462) industry.
According to them, there is a need for investors to explore opportunities in the mining sector, as a metric tonne of Gold is currently valued at $30million, adding that it is worth investing in the industry, especially as gold is a kind of commodity that does not easily lose its value.
One of such stakeholders, the Managing Director/Chief Executive Officer, Heritage Bank, Ifie Sekibo, during the Nigeria-Canada Investment Summit, held in Abuja, Friday, disclosed that the enormous potential of the industry was one of the reasons the Bank delved into mining despite the enormous risks.
According to him, the bank, with Dukia Gold as its partner, would facilitate access to local miners and artisans to get value for their commodity at international market price after being registered with Dukia Gold.
Sekibo, who was represented by the Team Lead, Agric Finance and Export, Adelana Ogunjirin, explained that prior to now, local miners of Gold found it difficult to trade their commodities favourably, but with the involvement of Dukia and Heritage Bank, a Quality-and-Quantity test will be conducted based on agreement, and that will lead to additional value to the smallholder miners.He explained that this will leverage the small miners the opportunity to also trade their commodities at international market price.
He said: “Mining sector is an area which has not been fully tapped in terms of the potential around it, as there are quite a lot of opportunities around that sector. Recently, we secured $1 billion funding line with our funding partner AfreximBank, which also is to support areas like solid minerals.
“Now with respect to this, we have looked at the value chain of this space, and we have looked at the opportunities that are there. A lot of fund providers have not really delved into this and it is because of the lack of understanding of the market.
“In terms of value, gold is an area where you can enhance the value. You hardly see Gold losing value, and you see that in different exchanges you even trade those commodities.
“Looking at it in terms of trend, you see that gold is something that will appreciate definitely. So in terms of the profitability of this business, we have looked at it, the crunch, the numbers we see is a space that the Bank will definitely earn a lot of income.”He also expressed optimism that other banks would like to come into the Nigerian mining sector, but may be studying to understand the sector properly.
“Heritage Bank has already carved a niche for itself in agribusiness space, just like the Gold commodity, this would be exported. So, in terms of export proceeds too, there are opportunities to be explored. Generally, looking at the Nigerian outlook, on the long run, this will also enhance the country’s external reserves. There are multiplier effects of what we are doing today, and that is why we are also moving in this direction,” Sekibo noted.
Also speaking, Managing Director, Nigeria Export-Import Bank, NEXIM, Abba Bello, revealed that the bank had gone into high level discussions with heavy equipment manufacturers and suppliers that would lease equipment to miners for exploration and processing, to make the equipment accessible and affordable.
Bello said: “For equipment supplier or outright purchase of equipment, we have gone into discussions with Bluecare and now Mantrac for the supply of heavy equipment for gold processing or exploration on lease basis and, it is something that does not exist currently within the industry.
“Barrick Gold and Bullion Mart is something that happen in the mining world. You don’t have to own the equipment, but there are vendors who supply the equipment for explorers to hire.
“Discussions have gone very far with the equipment suppliers and very soon we will announce the programme.”
Meanwhile, the Country Manager, ITM, Nigeria, Habibah Waziri, raised concerns on human resource development that would sustain the sector.Waziri also said there is a need to formalise the sector, and also invest in its human capital for growth and development.
