‘To boost reforms’: FG increases mining rates

The Federal Government has announced new rates for the mining sector to enhance ease of doing business and consolidate ongoing reforms.

The Minister of Solid Minerals Development, Dele Alake, made the announcement at a press conference in Abuja on Thursday, July 4, 2024.

Alake stated that the review underscores the federal government’s commitment to increasing revenue from solid minerals to enhance service delivery and bolster mining’s contribution to economic development.

The minister added the new regulations, introduced in consultation with industry stakeholders, aimed to discourage speculation and address the paucity of funds, limiting the federal government’s capacity to improve ease of doing business in the sector.

The new rates, which affect 268 items in the industry, include an annual service fee of N31,500 for the first time, N260,000 for a Small Scale Mining License (SSML), N500,000 for a Quarry Lease, and N1,250,000 for firms operating with a Mining Lease.

Following the renewal of licenses, the rates for the respective categories will be N42,000 for an Exploration Licence, N420,000 for a Small Scale Mining Lease (SSML), N1,500,000 for a Mining Lease, and N1,100,000 for a Quarry Lease.

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Under the new regime rates, investors applying for a Mining Lease license will pay N3 million, while SSML applicants will pay N300,000 for the first two cadastral units.

The cost to obtain an Exploration Licence (EL) is N600,000 for the first 100 cadastral units. A Quarry lease now attracts N300,000, while reconnaissance permit is N300,000.

Other services affected by the new regulations include mineral title applications of the Mining Cadastral Office (MCO), alongside the transfer, enlargement, surrender, and consolidation of mineral titles.

In the new rates regime, Lithium ore (Lepidolite) at the current market value of N600,000 per tonne attracts an N18,000 royalty per tonne; lithium (Kunzite) with a current market value of N3 million per tonne attracts a N90,000 royalty per tonne, while lithium ore (Spodumene) with a current market value of N316,667 per tonne attracts a N9,500 royalty per tonne.

The rates review also affects services rendered by the Mining Cadastral Office (MCO) and the Nigeria Geological Survey Agency (NGSA).

According to Alake, the new regulations seek to maximise royalties from critical minerals like lithium and gold to boost the nation’s revenue base and contribute significantly to economic development.

The minister noted that comprehensive details of the new rates regime will be posted on the ministry’s website.

He added that the new rates regime was with immediate effect.

The Star