(Ecofin Agency) - Nigeria's mining sector contributes less than 1% to the country’s GDP, a paradox considering the country's mineral resources are valued at $700 billion. Speculation around mining permits is one reason for this, which the government aims to address. 

Minister of Mines, Dele Alake, announced the revocation of 924 dormant mining licenses. These licenses will be redistributed to new investors on a "first come, first served" basis. 

In our efforts to sanitize the mining sector, I have revoked 924 dormant licenses spanning exploration, mining, small-scale mining, and quarrying licenses.

Adequate notice was given through the official Gazette of the Federal Republic of Nigeria. Out of the 963 licensees… pic.twitter.com/HWKdHXQjTc

— Dele Alake (@AlakeDele) April 24, 2024

This move aligns with the government's strategy to boost the mining sector's contribution to the economy. Despite the $700 billion in mineral resources, the sector contributes less than 1% of the GDP, mainly due to permit holders not developing their projects.

Officials revoked 273 small-scale mining licenses, 528 exploration licenses, 20 mining leases, and 101 quarrying licenses. “I believe this move will help clean up the licensing system and deter those who misuse opportunities in the sector. Going forward, the Federal Government will crack down on license racketeering and speculative practices, while encouraging serious investors so as to create job opportunities in the country,” Alake commented.

Nigeria announced in late March its plan to grant new mining permits only to companies with a local mineral processing plan, promoting a stronger local mining industry. The government also plans to establish a new mining company co-managed with the private sector.