Business Maverick

International Finance

Nigeria Woos Barrick Gold and Rio Tinto to Spur Nascent Mining Industry

Lights illuminate a mining truck moving through an underground tunnel at the South Deep gold mine, operated by Gold Fields Ltd., in Westonaria, South Africa, on Thursday, March 9, 2017. South Deep is the world's largest gold deposit after Grasberg in Indonesia, makes up 60 percent of the company's reserves and the miner says it's capable of producing for 70 years. Photographer: Waldo Swiegers/Bloomberg
By Bloomberg
13 Jan 2022 0

Barrick Gold Corp. and Rio Tinto Group have expressed interest in Nigeria’s largely untapped mining sector, according to the West African nation’s mining minister.

“They are looking at the possibility of coming to look at opportunities in Nigeria,” Olamilekan Adegbite said in an interview at a mining conference in Saudi Arabia’s capital, Riyadh. Africa’s biggest crude producer is hoping investors will follow the example of Thor Explorations Ltd., which has built the country’s first industrial gold project, as it seeks to cut its dependence on oil earnings.

Vancouver-based Thor poured first gold from its mine in southwestern Nigeria in July and is targeting output of 85,000 ounces a year. “We’re so happy and delighted because they have succeeded and so give the right signal for investors,” Adegbite said.

Read more: Thor Explorations Hits Nigeria’s First Commercial Gold Output

Toronto-based Barrick, the world’s second biggest gold miner, is among the firms “interested in coming to Nigeria,” while the government “has spoken with” London-based Rio, the top iron ore producer, about opportunities in the country, Adegbite said without providing additional details. The government intends to auction rights to mine gold, lithium, copper and limestone later this year, he said.

Barrick and Rio didn’t immediately respond to emails seeking comment.

READ: Trafigura Warns Metal Stockpiles at Critical Level: Saudi Update

Africa’s most populous nation has sizeable reserves of metals including gold, zinc, lead and iron ore, but nearly all extraction is done informally with rudimentary equipment. Before Thor’s launch, the contribution of mining to gross domestic product stood at less than 0.1%.

In the 1960s and 1970s, mining made up 4% to 5% of Nigeria’s GDP, before major operations shut down and crude oil came to dominate the government’s agenda.

Gold smuggling has also been a problem, with much of it destined for Dubai, according to Adegbite, who is seeking help from authorities in the United Arab Emirates to stem the flow. “We are in discussion with the UAE government to stop such practices,” he said. “We’re getting some traction.”

Gallery

Comments - share your knowledge and experience

Please note you must be a Maverick Insider to comment. Sign up here or sign in if you are already an Insider.

Everybody has an opinion but not everyone has the knowledge and the experience to contribute meaningfully to a discussion. That’s what we want from our members. Help us learn with your expertise and insights on articles that we publish. We encourage different, respectful viewpoints to further our understanding of the world. View our comments policy here.

No Comments, yet

Please peer review 3 community comments before your comment can be posted