10 May 2016, Sweetcrude, Houston, Texas – The Federal Government has announced plans to open the process for prospective investors interested in exploring the country’s vast bitumen deposits to bid for allocation of operational licenses.
The Minister of Solid Minerals Development, Dr. Kayode Fayemi, who disclosed this on Friday during a working visit to bitumen bearing communities in Agbabu area, Ondo State, said only serious investors with proven work and financial plans would be allowed to participate in the bid round.
The minister assured the communities of government’s readiness to protect their interest through the right policy and regulations, adding the licencing process would be completed within a year.
Nigeria’s bitumen reserve, spanning approximately 120 square kilometres, is reputed to be the second largest in the world.
But, the exploitation and development of the resource has been limited to the artisanal level, as the operational permit is yet to be formalized by government.
During the visit, the minister, in company of other ministry officials, inspected samples of bitumen in Agbabu, Ilubirin and Lado communities and also interacted with leaders of the communities.
“We want your mineral to work for you, and we are fully ready to assist your communities get the best from the process,” the minister told the community leaders. “Federal Government would partner with states, investors and the communities to create the enabling environment.”
He assured that within the next six months massive work would commence on the bitumen project, adding that government has put in place policies that would guarantee the effective exploration and exploitation of the mineral.
The minister lamented that about 80 per cent of asphaltic materials used for road construction in the country were still being imported in spite of the vast bitumen deposit, assuring that the government would focus on ensuring that serious investors with proven work and financial plans were given licences.
“Priority will be given to investors with the capacity to build processing plants to boost local production, help meet local demand and create jobs for our youth,” the minister said.
He reiterated the commitment of the ministry to ensure that the solid minerals sector contributed an average of 0.3 to 10 per cent to the Gross Domestic Product (GDP) in the near future.
According to Fayemi, the mining sector has witnessed extensive reforms since 1999, as a result of the implementation of the Nigerian Minerals and Mining Act of 2007, saying the country would continue to provide a transparent and workable regulatory and policy environment for a private sector-led mining sector to emerge.
The Minister noted that apart from the regulatory framework to protect local and foreign investments, other incentives like tax holidays and duty-free regime on mining equipment, have been put in place to encourage serious investors.
Equally, local investors would be supported through access to funding as well as equipment leasing.
Fayemi added that prospective operators must be prepared to play according to rules and standards, warning that the ministry would monitor closely activities of investors to ensure compliance with laid down procedures and guidelines.