Mining Sector: A Quest To Leverage  Legal Framework For  Artisanal And Small-Scale Miners  (ASM)

By Genevieve Aningo

The mining sector in Nigeria remains under explored despite its potential to accrue Nigeria buoyant economic gains.  . It’s a fact that Nigeria is home to most natural mineral resources such as gypsum , iron ore, zinc, gemstones, gold, bitumen, coal, rock salt, emerald,  talc, uranium, etc across states in the country but their local production and utilization are amiss .

These proven mineral resources reserves  are deposited across the western, northern and eastern parts of the country.

Mineral resources are vital in construction, manufacturing, agriculture and energy supplies production. Though Nigeria began to explore her natural mineral resources from 1902 , the impact of the sector is still subtle. For instance, the industry only contributes  about 0.3 percent gains to the nation when Nigeria should set pace for mining among African nations for possessing over 40 types of natural minerals .

With a watchdog of the Federal Government known as the Federal Ministry of Mines and Steel Development, the industry is governed by some laws to guide the  miners in the country . These laws include ; Minerals and Mining Act No. 20 of 2007,  National Minerals and Metals Policy and the Nigerian Minerals and Mining Regulations 2011.

Nigeria’s mining industry is supposed to be leading among African nations but the reverse is the case as South Africa leads. A bane of Nigeria’s mines industry is the export of her natural resources in crude form  with no value addition . According to the Nigeria Extractive Industries Transparency Initiative (NEITI), during the first quarter of the year over 80 percent of Nigeria‘s natural minerals was exported to China, then followed by Malaysia and Vietnam.

Another report by the body in 2019 detailed that Nigeria exported Zinc, Ores and Concentrate, Lead ores and concentrate, and Silica Sands and Quartz over any other minerals .

Despite these efforts to harmonise  the activities of mining the sector is still saddled with poor talent, policy deficit , financial needs , lack of training and awareness to reposition the industry

Recently, at the maiden Lagos Gold and Gemstones Conference Exhibition 2022 spearheaded by Founder of Women In Mining and In Nigeria (WIMIN), Engr. Janet Akinyemi   and other industry experts lent their voices on how to redirect the mining sector into limelight and curb cumbersome practices that suffocate the industry.

Barr. Olusina Sipasi, partner at Aelex Law Firm, said that land Use Charge and credit laws are some of the laws in the mining sector that do not encourage local content of mining. He said: ‘In Issue of property, the major law regulating the issue of property is the Land Use Charge  but we know apart from the land use act we have  some lands that are held by families , communities and many of these people do not know about Land Use Charge and to tell them the government has a right to their land is naturally a non- starter conversation. There is an  issue around our land registration system, it is affecting mining operation and if we are going to be having large scale mining it is issue regulators and authorities need to pay serious attention’’

He believed that Land Use Charge is essential because mining industries use lands as security when seeking  funding aids . He maintained that addressing the short falls of the Land Use Charge would boost local mining industries and attract foreign companies.

“The people who would finance mining are not Nigerian banks but international finance institutions. This is where the government  can help in the industry to ensure that the value of land for purposes are secure transactions and  release funding for the mining sector because people are also worried about protecting minority investments. There is a drive towards local content  which means we want Nigeria to have a lion’s share when it comes to Nigerian business’ , said Sipasi.

However, Sipasi, pinpointed that a huge chasm in encouraging local investments by the government is the criteria to obtain loan from Central Bank of Nigeria through the Bank of Industry. He sees such requirements as stringent and unrealistic to enable companies to obtain loans let alone Artisanal and Small Miners (ASM) or groups that have access to credits from the government.

He explained: ‘’The Central Bank has put some Funds aside through the Bank of Industry for mining funding but there is no way Artisanal and Small Miners can access these loans  because by the time the industry reels out some of these conditions you see that even established companies are struggling to fit into those conditions. If established companies are struggling, then those rules need to be re-tuned if they want  the small artisanal miners to benefit’’.

He begged the Nigerian governments  to coordinate its various Ministries ,  Departments and Agencies (MDA) that are involved in issuing business permits to mining companies to fast track ease of doing business.

‘’The law is reasonably clear however, in getting a permit , it involves more than one MDA. There are so many ministries and departments, agencies that are involved in granting permits. This is not peculiar to Nigeria. What may be putting us at disadvantage, is the issue of coordination among the different MDA’’.

Speaking on ways to make sure the legal frameworks in the mining industry address community problems, a Senior Research Fellow, Nigerian Institute of Advanced Legal Studies, Laura Ani stressed the need for the Mining Act 2011  to be enforced so that Artisanal and Small Miners can have access to extension services, funding, training, social amenities, technology and education.

She explained, ‘’The ASM sector has the potential to boost the Nigerian economy but there are a lot of issues, most people who anticipate the ASM are from rural settings. ASM conditions  are bad; some of them don’t have access to education, technology or extension services so it makes it difficult for them to prove their potential. The laws are there  but they are not enforced . For instance,   section 91 of the Mining Act provides for extension services extensively but the average miner and ASM lacks access to finance and technology.   The Mining Regulation in 2011 needs to have a lot of awareness for it to have impacts. There is no point having a law without enforcement’’.

Ani also revealed that gender bias is rampant in the ASM process though women’s role is estimated  at 90 percent. She canvassed for the Mining Act to be revamped to address Gender Responsive Issue and Shared Value Approach.

In her words :”There is this bias that more men are in the ASM but the truth is that women participate throughout the entire sphere of mining and we are talking about ASM and even Large-Scale Miners. Statistics show that 90 per cent of women are in ASM. Women contribute massively to the production of  gemstones and tarnites. Women are marginalized and are negatively impacted in mining activities. There is no resistance to patriarchal ideologies that don’t allow women access to education, medical services, funds and equal pay.  That is why the Mining Act should inculcate Gender Responsive Policies to target women issues. There is a statistic on the 2022  global gender gap index and  Nigeria is  123rd out of 146 countries .  On the continental level, the African Union has specifically recognized that  gender equality is a fundamental human right.  Women inclusion is integral to regional integration , socio  economic development and economic development. Women need capacity  training, specialized institutions to  target women , access to finance and support services at the mining sites because many women operate on their own’’.

Also, Ani highlighted the need for a Shared Value Approach among mining companies and their host communities where mining activities are explored . She reeled out : ‘’One big issue is the shared value approach . In the Mining Act section 116 centered on  community development agreement. Thus , mining companies need to have a social project in agreement with the host communities to  Infrastructure, roads and power balance among the local chiefs of the host communities and the mining companies . I don’t agree government should come in but Non-Governmental Organisations need to train, local chief men on how to negotiate on behalf of their communities

Another hindrance is that most mining problems are isolated from the real problems of ASM  which is poverty, ASM is poverty driven. A lot of children are involved in ASM and this is a violation of fundamental human rights and I feel the problem is that these miners are mining out of poverty. If they address poverty,  I don’t think children would be involved . Mining businesses need to check their entire supply chain to know if children are involved because if they patronize people that use children, they are also contributing to the problem. I think corporate organisations  have a responsibility in providing extension services and need to develop an ASM strategy to enable people to have access to finance to alleviate their poverty’’.

 A partner at ENR Advisory , Jumoke Fajemirokun  in her speech said that Nigerian banks and other local financial platforms   do not aid ASM access loans due to their bottlenecks in form of requirements .

She advised that the Mining Industry  needs to adopt some lessons from the Petroleum Industry Act in creating a balanced act that caters for the community needs and small miners .

‘As an ASM operator even when you have lots of Naira but  because established companies find it difficult to get funds from the platforms, I can only imagine the difficulties faced by small scale miners ; especially when they are not very skilled or educated. So  we need intervention in this regard.”She added.