The Federal Government has pledged to make Nigeria a major gold producing hub in Africa and it is ready to give necessary support to the sector to drive the diversification plan of the Nigerian economy from oil.
This was disclosed by the Minister of Mines and Steel Development, Olamilekan Adegbite, during a facility tour of Segilola Gold Project, Iperindo, Osun State on Thursday.
The Minister, in a statement issued by Ayodeji Adeyemi, his Special Assistant, and seen by Nairametrics, explained that the Federal Government was poised to support mining companies to grow the economy and create jobs for its citizens.
According to him, the visit was to lend support to the company and to inspect the level of work carried out at the site. He thereafter expressed delight at the progress of work done.
Adegbite said, “We want to make Nigeria a major gold producing hub in Africa and this is why the administration of president Buhari has given so much support to this sector to ensure that we diversify our economy away from oil .
“Indeed the Ministry of Mines and steel development has provided a number of incentives to businesses and investors to spur growth in the sector. Some of the incentives include: waiver on Customs and import duties for plant, machinery and equipment imported for mining operations.
“Tax holidays of between three to five years for businesses as applicable. Free transferability of funds and permission to retain and use earned foreign exchange. Capital allowances of up to 95% of qualifying capital expenditure. Deductibility of Environmental Costs (money meant for environmental remediation will be tax free) and 100% ownership of mineral properties.”
Assuring Nigerians that the project would be completed before the end of the second quarter of 2021, the Chief Executive Officer, Segilola Gold Project, Segun Lawson, stated that in spite of the challenges brought about by the pandemic, the company’s target production start date would not change.
He added that the company was aiming to produce an average of 80,000 ounces of gold per year for the life time of the mine.
He said, “The company had created 500 direct jobs and 1100 indirect jobs. Despite the challenges of constructing during the pandemic we have ensured that all our facilities are built to world class standards.“
What you should know
- Segilola Gold Mine, owned by the Canadian mineral exploration company, Thor Explorations Limited, is set to be completed in the first half of 2021.
- The gold mine which was built to place Nigeria on the list of major gold producing nations, is expected to create about 400 direct and 1,000 indirect jobs by carefully exploring the abundant wealth inherent in the gold value chain.
- Earlier in the week, Adegbite had visited the governor of Kaduna state, Nasir Ahmad El-rufai, and equally reiterated the Federal Government’s commitment to grow the mining sector and support mining companies in the sector.
- The Minister assured the governor that the ministry was ready to collaborate with the state to harness some of its mineral resources in the right way as provided by the constitution.
- He also pledged the ministry’s support to help with a mining engineering department in the new Kaduna State University.
Key takeaways from the OPEC+ meeting
Here are key takeaways from OPEC’s recent meeting as the organisation shows admirable strategy in the global oil market management.
The 14th Meeting of OPEC and non-OPEC Ministers took place via video conference on Thursday 4th of March, 2021, under the Chairmanship of HRH Prince Abdul Aziz bin Salman, Saudi Arabia’s Minister of Energy, and Co-Chair His Excellency Alexander Novak, Deputy Prime Minister of the Russian Federation.
In theory, OPEC+ is an organization but in practice, the Group operates like a “cartel” as Ex-US President, Donald Trump describes it. His Royal Highness Abdul Aziz Bin Salman is the well-articulated Head Honcho. The manner in which he has high-handedly managed the oil markets was evident in his responses at the latest meeting.
Here are a few takeaways from the meeting.
OPEC+ getting back control of the Oil markets
In one of his addresses, Saudi Arabia’s energy minister Prince Abdulaziz said that the OPEC Plus cut combined with his country’s voluntary cut managed to accelerate the recovery process of the market.
Evidently, the market has been in an uptrend since the negative prices experienced early last year. Although the markets have experienced a few hurdles externally (geopolitics) and internally (quota cheats and disagreements), prices have rebounded to the highest since 2019. What makes this more remarkable is there is still a pandemic and jet fuel has yet to rebound as aviation has not recovered.
OPEC+ riding the wave of the financial markets
With the bond market on the edge on the signs of inflation, it appears investors are hedging inflation with commodities. That is why all commodities appear to be on the upside. Commodities tend to shine during periods of inflation. With gold prices melting, it appears funds are exposing their portfolio to oil. Hence, why some analysts have argued current prices are not a reflection of supply and demand. They believe the recent oil price rally might have been caused more by financial players rather than improvements in physical oil market fundamentals.
Caution and Vigilance needed to balance the markets
During one of OPEC’s chair remarks, Prince Salman reiterated how important compliance has been in the recovery process. He also commended HE Timipye Sylva’s in his diplomatic management as he compensated on previous failed quotas and his mission as Special Envoy to Congo, Equatorial Guinea, Gabon and South Sudan in complying with their quotas. In his words to the Minister of State for Petroleum Resources, “you have earned your graduation”.
Prince Salman also reiterated how important caution and vigilance are needed in these markets. He said, “we have learned in the course of the past year, the difficulty of making hard predictions in such an unpredictable environment.”
He further added that, “We Have mitigated the impact of the last three waves of pandemic by avoiding complacency. To buttress his speech, he said ‘we did not cast caution to the winds, nor endanger our achievements over the past year. We have elected to follow a careful and proactive approach that has proved successful.”
OPEC+ unity getting stronger
In every successful relationship, understanding and unity are very key tenets needed. Although Russia has a separate agenda of theirs, with regards to the U.S shale, market share and their domestic needs, they still understand that the ultimate priority is to keep the group united. This was reiterated by Alexander Novak, the Russian Minister agreed that the market hasn’t fully recovered but it’s in a better state than it was a few months ago. He also stressed the importance of conformity to the pact.
The fact that the group even had a majority consensus on the decision not to rollover cuts for April shows that there is a lot of unity in the group. Nigeria also supported the views that there should not be additional supply.
On U.S Shale and Joe Biden
“Drill, baby, drill is gone forever.” These were the words of the Saudi Energy Minister Prince Abdulaziz bin Salman, who in all indications is boasting that the U.S shale revolution has ended. It appears U.S shale is kneecapped as most shale companies suffered financial bankruptcies during the last oil crash. Also with little Capital expenditure and demand for American oil, OPEC has regained dominance in the markets. Personally, I noted this when the markets still went up after an EIA report on a 20 million barrel build in U.S crude inventories which is very unusual.
On the other hand, Saudi Arabia is going to have some sort of love-hate relationship with Joe Biden. With talks of a sanction on Saudi Arabia over the death of Jamal Khashoggi and other human rights which has forced the U.S to ‘recalibrate’ their issues with the Middle-East nation. However, Prince Salman must love having an American President who is so focused on climate change, energy transition and renewable energy which inadvertently means the rise of OPEC+ and oil prices will have a smooth sailing.
India and China will have to use their stockpiles
When asked about India, The OPEC chair, Prince Salman said that India should start pulling oil out of the cheap stocks they bought last year. Notably, when prices were down, a lot of oil-importing nations filled their inventories with cheap oil. Saudi Arabia’s Energy Minister is of the belief that India and the rest should exhaust what they have accumulated during the oil price crisis. This would be disappointing to India, as they wanted more supply (lower prices) to boost their economic recovery.
Oil traders and stakeholders did not see this coming. Every speculator short in the market will be “ouching like hell” as HRH Prince Salman warned last year. Kudos to Egypt for hedging against high prices as it seems that prices will keep rising in the foreseeable future. OPEC once again has shown admirable strategy in the global oil market management. Additionally, Saudi Arabia is extending its voluntary output cut by another 1m b/d, and the cartel isn’t increasing output for April.
You can find the full press statement from OPEC here
Update: Fire outbreak as tanker explodes
A fuel tanker has exploded around an NNPC filling station on Alagbole-Akute road.
There is a fire outbreak as a tanker carrying Premium Motor Spirit (PMS), popularly called Petrol exploded around an NNPC filling station on Alagbole-Akute road, Ogun State on Saturday.
This was disclosed by some eyewitnesses in the area.
Witnesses said the fire started at about 6:45am while the firefighters were immediately contacted, and they arrived at the scene at about 7:23am.
No injury or death was recorded as a result of the incident.
The incident occurred in a border community with Lagos while the firefighters seen at the scene were officials of the Lagos State Emergency Management Agency (LASEMA).
Officials of the Federal Fire Service were also said to have arrived at the scene of the incident shortly after the fire had been put out.
Nairametrics | Company Earnings
Access our Live Feed portal for the latest company earnings as they drop.
- Seplat falls into a loss in FY 2020
- 2020 FY Results: Cornerstone Insurance Plc reports a 61.1% decline in profit
- Ellah Lakes increases operating expenses by 33.36% in HY 2020
- 2020 FY Results: Nigerian Breweries reports a 54.3% decline in profits in 2020
- Abbey Mortgage Bank projects N51.08 million profit in Q2 2020.