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From Charity Nwakaudu, Abuja
The Executive Secretary of the Solid Minerals Development Fund (SMDF), Hajiya Fatima Umaru Shinkafi, has stated that Nigeria can only unlock its estimated $700 billion mineral wealth if it establishes a robust and credible mining finance system.
Speaking at the launch of the Ore Reserve Development Forum (ORDF) in Abuja, Shinkafi—represented by Dr Martina Ananaba, Head of Minerals and Project Development—emphasised that the sector is gaining traction under reforms by the Minister of Solid Minerals Development, Dr Dele Alake, with mining’s contribution to GDP rising from less than 1% to 4.6%.
She warned, however, that despite Nigeria’s abundant resources, many mining operations remain unbankable due to poor geological data, weak reporting standards, and artisanal practices.
“The real challenge is not lack of capital. The challenge is lack of bankable projects,” she said.
Shinkafi explained that the ORDF was established after industry experts in 2024 agreed that Nigeria requires consistent ore reserve reporting, enhanced technical capabilities, and transparent financing pathways to attract investors.
She added that SMDF is already de-risking early-stage projects, enforcing rigorous due diligence, and partnering with capital-market institutions to prepare credible mining companies for investment.
Noting recent progress, she highlighted that 867 mining licences issued in Q1 2025 generated ₦7 billion, reflecting renewed investor interest.
Shinkafi encouraged stakeholders to use the forum to create a practical Mining Finance Framework that would set standards, guide miners, and enable financiers to accurately assess risks.
“If we build the right financing system, mining can become a true pillar of economic diversification,” she concluded.
The Chairman of the Geological Society of Nigeria, Uba Saidu Malami, remarked that Nigeria’s mineral wealth will only translate into national prosperity once the country scientifically certifies its resources to international standards.
He noted that mining finance largely comes from capital markets rather than banks, making internationally certified reports essential for junior mining companies.
Malami also referenced connections between natural resources and insecurity, underlining the urgency of mitigating risks and ensuring that Nigeria assigns real value to its gold, diamonds, and transition minerals through dependable exploration and reserve reporting.
Mining investment expert and Mont Capital executive, Jon O’Callaghan, suggested that Nigeria could build a mining industry outstripping oil and gas within 25 years—if the country attracts risk capital into exploration, not merely mining.
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O’Callaghan said Nigeria already has in place the appropriate policies and that the Federal Government has “done its job” by creating an enabling environment.
According to him, the missing link is investor willingness to fund exploration, which serves as the bedrock of every successful mining industry.
“It’s not about government anymore. Without exploration, there is no mining. And without risk capital, there is no exploration,” he said.
“There’s a lot of money to be made in exploration, and investors need to understand that.”
He described the sector’s greatest financing challenge as constructing a system that allows investors to participate with confidence.
To address this, he revealed that stakeholders are now collaborating with the Nigerian Exchange (NGX) and the Securities and Exchange Commission (SEC) to replicate global mining investment models.
He indicated the aim is to mirror operational standards of top mining exchanges—the Australian Stock Exchange, Toronto Stock Exchange, and London’s AIM—to attract exploration capital into Nigeria.
“All we are doing is creating the same environment that works elsewhere in the world, to enable investors to invest,” O’Callaghan said.
He commended the organisers of the ORDF and affirmed that with proper funding at the exploration stage, Nigeria’s minerals sector could surpass oil and gas within a generation.
Technical Adviser to the Executive Secretary of the SMDF, Mr Abdulmajeed Amussah, stated that the partnership between the Fund and ORDF is intended to de-risk mining assets and transition the sector from informal operations to investment-ready projects.
He explained that although Nigeria is rich in shallow deposits accessible to artisans, most assets are not developed sufficiently to attract formal finance.
Through its mandate, the SMDF is offering strategic funding and technical support to turn mineral potential into shared prosperity.
Amussah revealed that a recent early-stage exploration funding window highlighted major capacity gaps, as fewer than ten applications met the required standards from thousands of existing licences.
