FG’s New Mining-Rates: A Game-Changer For Economic Development? (View Details)

The Federal Government has unveiled a new set of rates for the mining sector, aimed at improving the ease of doing business and supporting ongoing reforms. This announcement was made by the Minister of Solid Minerals Development, Dr. Dele Alake, during a press conference in Abuja yesterday.

Dr. Alake emphasized that this rate review highlights the government’s dedication to increasing revenue from solid minerals, thereby enhancing service delivery and strengthening the mining sector’s contribution to economic development.

Under the new regime:
– Investors applying for a Mining Lease license will pay N3 million.
– Small Scale Mining Lease (SSML) applicants will pay N300,000 for the first two cadastral units.
– An Exploration Licence (EL) will cost N600,000 for the first 100 cadastral units.
– A Quarry lease will be N300,000, and a reconnaissance permit will also be N300,000.

These regulations were developed in consultation with industry stakeholders to deter speculation and address funding shortages that have previously hindered the sector’s growth.

The revised rates, impacting 268 industry items, also include:
– An annual service fee of N31,500 for the first time,
– N260,000 for a Small Scale Mining License (SSML),
– N500,000 for a Quarry Lease,
– N1,250,000 for firms operating with a Mining Lease.

Upon license renewal, the rates will be:
– N42,000 for an Exploration Licence,
– N420,000 for a Small Scale Mining Lease (SSML),
– N1,500,000 for a Mining Lease,
– N1,100,000 for a Quarry Lease.

Additional services affected include mineral title applications, transfers, enlargements, surrenders, and consolidation of mineral titles by the Mining Cadastral Office (MCO).

Dr. Alake highlighted the goal to maximize royalties from critical minerals such as lithium and gold to enhance the nation’s revenue base and significantly contribute to economic growth. For instance:
– Lithium ore (Lepidolite) with a market value of N600,000 per tonne will attract an N18,000 royalty per tonne.
– Lithium (Kunzite) valued at N3 million per tonne will attract a N90,000 royalty per tonne.
– Lithium ore (Spodumene) with a market value of N316,667 per tonne will attract a N9,500 royalty per tonne.

The new rates regime is effective immediately.