News Stories in 1st Quarter 2007 Edition of DDH Magazine
How to start sand mining:
An informal chat with a top official of the Ministry of Solid Minerals Development.
Nigeria’s solid minerals are now receiving quite some popularity as the wealth yet to be harnessed. The Ministry of Solid Minerals Development (MSMD) says that Nigeria is blessed with 34 minerals including many kinds of sand, tantalite, zinc, silver and gold. In fact, Mining Communications, an international mining magazine, dubbed Nigeria an exciting new mining destination. So, on this first visit of DDH to a nearby office of the MSMD, many questions passed through my mind, not least being the concern to find out as much as possible of the laws affecting the lucrative trade in sand in many parts of Nigeria at the moment.
The officer who attended to me played the ultimate public relations man: it was obvious MSMD is in a new dispensation to try and get things right in that sector. A lot of discussion ensued, throwing up notions and illusions. I had thought that given the huge building boom in a place like Lagos and the unstoppable flow of sand lorries through its highways almost 24/7, Lagos state must be the national highest in terms of generating royalty for the MSMD. How wrong I was! My informant, who pled anonymity for reasons of office protocol, quickly informed me that the state with that record is Ogun State. He cited the location of West African Portland Cement at Ewekoro and the sheer volume of limestone, shale and other associated minerals needed to compound cement to justify why the scales tip in favour of Ogun State for the most abundant repository of minerals in volume and royalty generation. In addition, he volunteered that gravel, granite, laterite and bitumen all abound in Ogun state, in addition to large quantities of sand.
But this was only an incidental discovery because my original interest was to find out what is new about the laws and regulations governing sand mining in Nigeria today. I was made to know that a new law now before the National Assembly will, when passed, seal the transparency of issuing mining licenses, mineral titles and documentations at the MSMD. Before now, I was told, the various officers in charge of the MSMD state offices were free to issue licenses as they wished…in the process, bribery and unwholesome practices prevailed. But since “Madam Due Process” (referring to Dr Oby Ezekwesili, erstwhile Minister of Solid Minerals Development) passed through that department of state, things changed for the better, regulation-wise, our top official confided in the reporter.
Firstly, no mining licenses can be issued anywhere else in Nigeria today except at the Mining Cadastre Office located in Abuja. He said the MSMD has been divided into four departments, namely, Mining Cadastre Office, Mines Inspectorate Department, Environmental Compliance Department and the Artisanal and Small-scale Mining Department, for the purposes of the new dispensation. For now, only the Cadastre Office based in Abuja can issue valid mining licenses and the process is also stipulated down to number of days the process should take!
I fired one popular question. If I want to go into sand mining now, what steps do I need to take from the perspective of MSMD documentation? He said I must first do a sand search of the area of my interest using a GPS to identify the coordinates. The sand search is to determine adequate availability of sand quantity in the area while the coordinates are for record and allocation purposes in my application. He said essentially files are no more in use in these matters because once the coordinates are obtained and taken to the MSMD office, if the area is free and all other conditions are met, it will be marked as allocated to the proprietor and the equivalent of an electronic flag would be attached to those coordinates. No other applicant coming with the same coordinates will be granted license for that location. The licenses are for 25 years, renewable every 20 years.
Once allocation has been made, the proprietor must proceed to the next stage of specifying how much sand he wants to pump. This is for the purpose of paying the stipulated royalty to the federal government via MSMD. The amount is N28.00 per ton. Once approved and the quantity has been pumped and sold out, the operator must pay again for every new campaign of sand dredging he wants to do on that location. On the list of requirements for documentation, he added that the operator must also visit the offices of National Inland Waterways Authority, NIWA, to obtain other papers as well. But I retraced his steps, wanting to know how his office can keep tabs on operators in far-flung field stations if they planned to do a fast one and pump as many times as they can get away with. His reply was simple: they monitor the busy spots every once in a while. According to him, in busy places like Ajah in Lagos State, for example, if they do not check on things for, say, one month, an operator can pump many times and sell off in such a short span of time. So, the appropriate department keeps a constant tab.
Perhaps for furtherance of this keen surveillance, MSMD has zonal offices at Ibadan, Enugu, Benin, Kaduna, Jos and Maiduguri. My questions were becoming a little too many for a single encounter, I could notice the man’s calculations. Again, I showed no immediate inclination to pick up a form or get more definite. On my part, I felt there could something else. Now, I wanted to know what else is new with the new law before Nigeria’s parliament. My informant seemed resigned to put up with my queries. He said whereas the old law exempted artisanal and small scale miners who inherited the trade from their forefathers from the rigours of registration and licenses, the new law demands every operator, no matter the level, to obtain a license. The license fee for small scale mining is N5,000.00 but without any of the cumbersome paper work required from bigger operators, who, on their own part, must furnish their company incorporation documents, field coordinates, NIWA documentations and any other required paper work. For their registration, what do the operators stand to gain? I was made to know that there was a plan to direct small-scale operators to the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) for loans to increase their businesses. For the big-time operators, however, he said some of them get the protective cover of the MSMD offices whenever they are confronted by officials of the state government to pay various charges. He cited example with Lagos State where an edict is being used by overzealous officials to extract levies from sand miners whose MSMD licenses ought to exempt them from such charges. Or when MSMD officials intervene with local land owners to smoothen frictions on the field when host community demands become unbearable. Otherwise, he reckoned that the MSMD office was always friendly to all operators who call on them since the new emphasis to properly harness Nigeria’s many solid minerals. Does this mean that the operators flock in droves to come and comply? He said no, revealing there was work to be done to in that area. Actually, he admitted that following their mandate, MSMD teams of officials usually scout the hinterland and liaise with local informers to track down operators who do not want to come to the open.
Then I noticed that some of the mining licenses stipulated either gravel or sharp sand or filling sand, etc. I was told this means that the licenses ought not to be breached; that a licensee for sharp sand should not engage in the gathering of any other type of sand or mineral. I thought this would be hard to enforce but was impressed that it was actually an offence, though, for now, the offenders would be enlightened and let off. How long such leniency would last was not made clear. But what other significant tasks engaged MSMD’s attention in the new dispensation? I was made to understand that this includes inspection for environmental compliance, to ensure that the watery dredge does not escape the mandatory bond wall and flow on to thoroughfares or human habitats. Or in the case of other mines, that activities are properly restricted to locational boundaries. If MSMD officials notice failure of this regulation, such locations are sealed until remedied. Since the recent pruning of federal government ministries, the present Ministry of Solid Minerals would now be known as Ministry of Solid Minerals and Steel Development.