The Minister of Mines and Steel Development, Kayode Fayemi, disclosed this after the FEC meeting presided by President Muhammadu Buhari in Abuja, the Federal Capital Territory on Wednesday.
Fayemi who was accompanied by his counterparts, the Minister of Information, Lai Mohammed and Minister of Transport, Rotimi Amaechi, said the funds which will come from 1.68% of the Federation Account will mainly focus on mining exploration, which he noted, is the heart of mining.
The minister said the approval was in line with President Muhammadu Buhari’s campaign promise to diversify the economy with emphasis on agriculture and mining sector.
He said: “FEC rectified the president’s anticipatory approval for Ministry of Mines and Steel Development to qualify to access the national resources fund.
“You will recall that in August FEC approved the road map for the growth and development of the mining sector.
“In recognition of Mr. President’s campaigns promises to Nigerians and in particular his consistent statement to diversification particularly in agriculture and mining sector, Council ratified the approval of N30 billion intervention fund for the mining sector. It will be highly focused on exploration. Exploration is the heart of mining, if you don’t search you won’t find.
“You have heard all sorts of talks about how rich Nigeria is in mineral resources but the quantity, quality, the geological prospectively has been a challenge because we have neglected the sector for such a long time.”
He explained that for Nigeria to attract mining investment, the country must first have an investment-based geological data.
According to him, smaller countries like Burkina Faso spend averagely $300 million a year on exploration.
“This is why Council approved this for mining and this is significant because this is the accessing of natural source development fund which has been made 1.68 per cent of the federation account. It is an equivalent of the ecological fund and the Education Trust Fund.
“It is meant primarily for agriculture sector, mining sector and the water resources sector. And this will cover exploration primarily but also research and development in partnership with our universities, it will also cover security and mining in partnership with the ministries of Interior and Defence and the DSS just to tackle the menace of illegal mining across the country. It will also support small scale miners with grants,” the minister added.
He said that the government is already in negotiation with sovereign investment on mining in order to access private capital to mining and the Nigerian Stock Exchange, which according to him will be ready in a month’s time.
On his part, Amaechi said the council approved advisers that would sit with General Electric as experts to negotiate the concession arrangement for the railway line.
He said the firm had proposed 25 years of concession period which is still open to debate.
According to him, the rehabilitation will encourage movement of cargos and passengers, adding that GE will do everything required to rehabilitate and invest on other railway infrastructure.