Despite a huge reserve of over 37 billion barrels of bitumen, the mineral used in the production of asphalt for road construction, manufacturing of asbestos and other waterproofing materials, Nigeria has continued to waste foreign exchange in importing the product, the latest report from the Nigeria Extractive Industries Transparency Initiative (NEITI) has indicated.
The report noted that lack of activities in some of the strategic minerals found in the country was leading to loss of foreign exchange through the importation of the product, of which Nigeria has the highest reserve in Africa, thereby draining the country’s revenue earnings.
With an estimated yearly import of more than N300 billion worth of bitumen into Nigeria and the pivotal role it plays in developing and infrastructure-starved nations, the organisation called on the authorities to encourage more exploration of the product also deployed in canal lining, underwater tunnels, river bank protection, dam construction and rail tracks.
NEITI further urged the federal government to pay attention to the extraction of barite, estimated at 15 million tonnes in the country and is a key material used in the oil and gas industry.
“The following strategic minerals: Bitumen, barite and gold remain largely untapped.
“Nigeria’s bitumen deposit is estimated at 37 billion barrels. Bitumen is an essential component in the building (manufacture of asbestos and water proofing materials) and construction (production of asphalt for road building sector).
“Our review revealed that bitumen has attracted very little attention over the years.
“This has led to loss of scarce foreign exchange through importation, under-development of the mineral which is strategic to our road infrastructure and opportunity for employment is lost to other countries,” the transparency initiative noted.
As for barite, NEITI disclosed that an estimated N5 billion is expended in the importation of the solid mineral annually despite its availability locally.
It said that in spite of its wide use in the oil and gas industry, the country has failed to develop the raw material in-country.
“Revenue, which would have accrued to the government in the form of taxes is unrealised. The continuous importation of barite negates the oil and gas local content development initiative.
“We reiterate a deliberate government policy aimed at encouraging exploratory and mining activities on our barite and strategies to phase out its importation for forex conservation,” the report said.
It also stressed that the mining of gold had not received that attention it deserved in form of investment, noting that it is still left at the artisanal level and mostly smuggled out of the country.
NEITI added that black market activities in the industry which pose security risks had become a disincentive for investors who are interested in the opportunities in the sector.
For the period under review, the body noted that Bayelsa remained the only state without any activity in the solid minerals subsector of the energy sector.
“While there was no recorded extractive activity in Bayelsa State, the cumulative contribution to production by Yobe, Enugu and Borno – the least states with mining activities- was 0.07 per cent,” it disclosed
According to NEITI, the top five destinations for Nigeria’s export for solid minerals were: China, Japan, Germany, South Korea and India.
NEITI also flayed the refusal of four companies in the solid minerals sector to cooperate with it during the latest audit, but added that their action did not affect the final report put together for the organisation by Tajudeen Badejo and Co in accordance with the rules set up for the implementing countries.