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Nigeria Earned N79.96bn From Solid Minerals In 12 Months– NEITI

Ebuka Daniel

The Federal Government earned the sum of N79.96bn from the solid minerals sector in 2019, an audit report of the Nigeria Extractive Industries Transparency Initiative has revealed.

The N79.96bn shows a 15 per cent increase when compared to the N69.47bn recorded in 2018.

The report which was released on Sunday disclosed that the Mines Environmental Compliance Department carried out reclamation of seven abandoned mines costing N534.81m.

It also noted that a total of 32 mining sites have so far been reclaimed from 2007 to 2019 with a total cost of N2.39bn.

The 2019 solid minerals report indicates that earnings accounted for 16 per cent of the total revenues of N496.28bn that have accrued to the federation from the sector over the period of 13 years (2007 to 2019).

This is also the highest since 2007 when NEITI commenced reconciliation of payments in the solid minerals sector.

A breakdown of the 2019 receipts as reported by NEITI showed that taxes to the Federal Inland Revenue Service (FIRS) on behalf of the federation accounted for N69.92bn or 87.4% of the total while fees and royalties paid to the Mining Cadastre Office and Mines Inspectorate Department accounted for N2.37bn (3%) and N2,55billion (3.2%) respectively.

Also revenue accruals to the States stood at N5.1bn, representing a 42 per cent increase when compared to the N2.1bn recorded in 2018.

The Federal Inland Revenue Services (FIRS) accounted for the highest flow to the coffers.

The NEITI report also disclosed that the outstanding amount of ₦8.887bn which accrued from the solid minerals sector as at 31st December 2019 was distributed amongst the three tiers of government in May 2020 using the revenue sharing formula. The balance as of 31st October 2020 was N3.948bn.

A breakdown of the distribution shows that the Federal and State governments received N4.073bn or 45.83 per cent and N2.065bn or 23.25 per cent respectively.

Besides, Local governments got N1.592bn or 17.92 per cent, while the balance of N1.155bn was distributed to only solid minerals producing states as their shares of the 13 per cent derivation.

According to the report, out of seven hundred and two (702) companies that paid royalties to the government in 2019, only seventy-four (74) companies met the materiality threshold of ₦3million.

This represents a 7.2 per cent increase when compared to 69 entities that met materiality threshold in 2018.

“These 74 companies accounted for 87.63 per cent of total royalties of N2.50bn paid in 2019, with the top five companies (Dangote Cement PLC; Lafarge PLC; Dangote Industries; Julius Berger; and Reynolds Construction) paying more than 50 per cent of total royalties” the report stated.

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