By Obas Esiedesa
An audit of the solid minerals sector commissioned by the Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed that the sector contributed N69.47 billion to the Federation Account in 2018.
The report of the audit which released on Sunday said the Federation earned N416.3 billion from the sector in 12 years covering 2007 to 2018.
The report stated that the 2018 figure was the highest so far since NEITI commenced reconciliation of payments in the sector.
The figure showed an increase of N16.71 billion representing 31.67% over the 2017 revenue of N52.76 billion. The earnings (N69.47 billion) also accounted for 16.69% of the total revenues (N416.3billion) that accrued to the sector from 2007 to 2018.
NEITI in a statement by its Director of Communication and Advocacy, Dr. Orji Ogbonnaya Orji explained that the audit report reconciled companies’ payments and government’s receipts from the sector in 2018 as well as tracked production volumes and trends of revenues from the sector to the federation account from 2007 to 2018.
Breakdown of the receipts showed that taxes to the Federal Inland Revenue Service (FIRS) accounted for N65.69 billion (94.56% of the total) while fees and royalties paid to the Mines Inspectorate Department (MID) and Mining Cadastre Office (MCO) accounted for N2.21 billion (3.18%) and N1.57 billion (2.26%) respectively.
According to the NEITI report, “Nigeria has published eight cycles of solid minerals audit reports since it signed up to the EITI. The sector has contributed N416.32 billion in revenues to the federation in 12 years. Over half of this figure or (N279.0 billion) was earned between 2015 and 2018”.
This shows that there had been a remarkable increase in revenues accruing to the Federation from the solid minerals sector over the years.
The report further highlighted that the sector had over the years, also witnessed fluctuations in revenue earnings. For instance, in 2015, N64.46billion accrued to the federation, while in 2016, the earnings dipped to N43.22billion. It will be recalled that 2016 was also the year that the Nigerian economy slid into recession.
The report disclosed that the main sources of revenue flows from solid minerals remains various categories of taxes, royalty, permits, annual services and sub-national payments. The report also stated that sub-national payments and other taxes accounted for “₦1.54billion representing about 2.23% of total government revenue from the sector”.
On production, the NEITI 2018 Solid Minerals Report disclosed that 46.68 million metric tons of minerals valued at N47.87 billion were produced in Nigeria during the period. “The production data was based on minerals either used or sold during the year”.
A breakdown of the production volumes showed that limestone and granite accounted for about 80% of the total minerals produced. Limestone alone contributed 54.85% while granite accounted for 23.88% of minerals mined.