By Onome Amuge.
Africa Finance Corporation (AFC) and the Solid Minerals Development Fund (SMDF) of Nigeria are joining forces to transform the mining sector in Nigeria and scale up artisanal mining operations to industrial levels. The collaboration aims to support the country’s economic development by increasing investment in the sector, improving infrastructure, and developing a sustainable and responsible mining industry.
The strategic partnership between AFC and SMDF was announced at Nigerian Mining Week, following an earlier agreement signed earlier this year. The collaboration is expected to address the shortage of expertise and funding for early-stage mining projects in Nigeria, enabling these projects to move forward and become fully operational. This will help to drive economic development in the country, as well as improving infrastructure and responsible mining practices.
Despite its rich mineral resources, Nigeria has faced challenges in developing its mining industry. However, AFC and SMDF’s partnership will help address these challenges and unlock the country’s immense mining potential. The institutions will leverage their combined resources and expertise to provide investment opportunities, technical support, and a joint project development facility, empowering promising mining projects to reach their full potential.
As part of the AFC-SMDF partnership, a key deliverable is the AFC-SMDF Investment Manual. This document will provide project sponsors with an overview of the joint project development facility, its objectives, and the specific requirements for project consideration. The manual will also include an appraisal checklist outlining the criteria for project evaluation, ensuring that the facility supports promising mining projects that meet specific criteria.
AFC and SMDF have created a dedicated portal for project submissions, managed by PricewaterhouseCoopers (PWC). PWC will work with local consulting firms to screen and conduct initial evaluations of projects. This streamlined process will help to speed up the project submission process and ensure that projects are evaluated thoroughly and efficiently.
In addition to streamlining the project submission process, AFC and SMDF have also engaged Wood Mackenzie to conduct a feasibility study on establishing a midstream processing plant in Nigeria. The study will assess the potential profitability and return on investment for processing critical minerals such as lithium and nickel, which are abundant in the country. This study will help to further de-risk the investment landscape for potential investors, thereby promoting the development of the mining sector in Nigeria.
Samaila Zubairu,AFC’s president and CEO, commented that Africa’s resources are critical to the world’s energy transition, and that more investment is needed to mine and process these resources in a sustainable way. He emphasized AFC’s commitment to unlocking Nigeria’s vast mineral potential by leveraging the country’s renewable energy sources to power local processing facilities. This, he said, will foster sustainable development and prosperity in Nigeria and Africa.
Fatima Umaru Shinkafi, executive secretary and CEO of SMDF, said, “We are pleased to deepen our partnership with AFC and collaborate on these strategic initiatives to support the Nigerian mining industry.”
Shinkafi noted further that the minister’s support has been critical to developing the initiatives, and they align with the ‘Renewed Hope Agenda’ and the ministry’s transformation agenda to leverage the mining sector to drive economic growth, competitiveness, and job creation.
The partnership between AFC and SMDF is considered an important step toward harnessing Nigeria’s mineral wealth and establishing the country as a leading player in the global mining industry. Since 2014, AFC has invested over $900 million in mining projects across Africa, including the Segilola Gold Mine in Nigeria, the Karowe Diamond Mine in Botswana, and the Bon Ami Bauxite Project in Guinea. These investments have helped to boost Africa’s mining sector and create economic opportunities for the continent.
