The Strategist

Nigeria Wants to Become a New Klondike


02/15/2016 - 13:03



Countries such as Ghana and Burkina Faso are always in the limelight of gold mining in Africa. However, over the past few years, high activity in the field of gold mining has been spreading to neighboring countries, such as Côte d'Ivoire, and, according to the latest news, even further.



USAID Guinea
USAID Guinea
On the one hand, the Democratic Republic of Congo last week announced that gold production on its territory in 2015 increased by 30% compared to 2014, and reached 820 th. oz per year.

Such a production growth occured at the expense of territories, which lie quite far from the southeast of the region's traditional gold mining in Ghana. A gold region even more rich may be located between the two territories.

This is Nigeria, one of the largest countries in the region. The local government announced its intention to launch the mining business.

Minister of Mining Nigeria Kayode Fayemi said the government has completed preparation of a full report on the licenses for subsoil use across the country.

Now, the state is committed to breathe new life into the areas of exploration, taking away licenses of those companies that have not demonstrated vigorous activity in areas of projects development.

Mr. Fayemi said that some licenses may be canceled as early as March 1 and passed into the hands of new operators. This step symbolizes desire to diversify Nigeria's economy focused on oil production.

To do this, the country needs serious reforms, as Nigeria has a good position from a geological point of view. However, due to the fact that the country lacks an adequate legal framework, there has not yet been large-scale geological exploration.

Oil

Nigeria is the largest oil-producing country in Africa.

Oil sales account for a significant portion of this country’s proceeds: Nigeria oil provides 100% of exports and two-thirds of total revenues.

However, once hurt by the fall in oil prices, Nigeria, like many other oil producing countries, is experiencing a tremendous challenge.

Apparently, the country wants to try to get out of the crisis bailed by the IMF and World Bank loans. Nigeria plans to finance a record spending and stimulate economic growth, which last year fell to a minimum since 1999.

The budget deficit set an historic record: 3 trillion in local currency, or $ 15 billion.

Forecast for GDP in Nigeria is 4.1% for 2016. The budget deficit will rise from 1.9% to 2.3%.

source: oilprice.com