Federal mining licensors at Nigeria’s Mining Cadastre Office (MCO) are looking to February 12 to commence the revocation of some 2,763 mineral titles whose holders have failed to pay outstanding yearly service fees in a new aggressive revenue drive designed to swell government’s coffers in 2021.
The titles at risk of federal axe represent 25 per cent of the total 10,959 mining operators registered in Nigeria, according to data from the Ministry of Mines and Solid Minerals Development as of December 31, 2020.
An MCO report spelling out this plan, issued from the office of its Director-General, Obadiah Nkom, and made available to the media, warns that “all Mineral title holders whose titles had been previously revoked by this Office, are also required to pay up all their outstanding liabilities prior to the revocation of their Mineral Titles in line with Section 155 of the Nigerian Minerals and Mining Act, 2007, failure of which necessary steps including legal action shall be taken against them to recover all the outstanding fees or liabilities as the case may be.”
The Mining Cadastre Office is the nation’s body responsible for the management and administration of mineral titles in the country, and on the list of titles now threatened by this new order, Small-Scale Mining Lease (SSML) titles accounted for 1,173 licenses of the total defaulters (42.45 per cent of the total defaulters), followed by 767 Exploration License (EL) titles holders (27.76 per cent], 688 Quarry Lease (QLS) titles licenses (24.9 per cent), while only 135 Mining Leases (ML) titles (4.89 per cent) are currently at risk.
Mining licensors also warned that “Mineral titleholders who are in default in the performance of their statutory obligations that this notice also serves as an intention to revoke their titles for non-compliance,” if they fail to remedy all their defaults in a fortnight from 12 January this year when the order was originally passed to them.
Mining Cadastre Office Accruals
The mining sector contributed ₦69.47 billion to the federal purse in 2018, representing an increase of ₦16.69 billion or 31.63 per cent over the previous year, 2017, according to data from NEITI in its current report, which indicated that the Mining Cadastre Office contributed N1.57 billion in 2018, a decrease of 21.95 per cent of N2.01 billion it made in 2017.
Figures for 2019 are unavailable in the public data spaces but Mr Nkom who leads the Mining Cadastre Office team told the media earlier this year, that the agency made 50 per cent of the total revenue generated by the entire Ministry of Mines and Steel Development that year. He also said the target for 2020 could not be met due to the global pandemic that struck at the beginning of the year and disrupted the entire process.
Mineral Title Acquisition
The Mining Cadastre Office (MCO) is charged with the responsibility of administration and management of mineral rights and titles through the application for or competitive bidding process in a transparent manner.
The application involves an online submission of completed forms that are subject to further review and evaluation. The applications are either accepted or declined based on the criteria met. Upon acceptance, the applicant pays fees and the license is issued on a “first-come-first-serve basis”.
For competitive bidding, the minister sets guidelines and invites interested investors through advertisements to bid for EL and ML only. The committee, therefore, reviews and evaluates the bidding process based on the set criteria. The winner emerges and the license is issued which is subject to the payment of a prescribed fee.
According to NEITI, MCO issued a total of 1,230 licenses in 2015, consisting of Reconnaissance Permit (RP), EL, ML, SSML, and QLS. In 2016, it issued 1,465 licenses, 1,580 licenses in 2017 and 1,516 licenses in 2018.
A title may be subject to revocation as stated in the Nigeria Minerals and Mining Act by an approval from the Minister if the titleholder fails to pay up the annual service charge after a 30-day prior notice through a registered post address.
