FG ig­nores Nige­ria’s multi­bil­lion naira gem­stone de­posits

Daily Trust - - BUSINESS - By Ade­mola Adebayo

Gem­stone busi­ness is a big in­come gen­er­a­tor and Nige­ria should be mak­ing good money from it. But it is not. Nige­ria is en­dowed with abun­dance of pre­cious and semi-pre­cious stones that can fetch bil­lions of dol­lars on the world mar­ket. Gem­stones like sap­phire, ruby, aqua­ma­rine, emer­ald, tour­ma­line, topaz, gar­net, amethyst, zir­con and oth­ers are avail­able in large quan­ti­ties. Paraiba tour­ma­lines found in Oyo state, for in­stance, could go for as much as $5,000 per carat, say ex­perts.

A global re­port as­serts that scarce pre­cious gems like beryl and aqua­ma­rine, sap­phires, zir­con in bub­ble-gum pink and wa­ter­melon tour­ma­line grades from green to red can be sourced from only Ti­bet, Nige­ria, Afghanistan and Brazil.

Gem­stone min­ing has boomed in var­i­ous parts of Plateau, Kaduna and Bauchi states for years. How­ever, the avail­abil­ity and dis­tri­bu­tion of th­ese min­er­als is not the sub­ject mat­ter; what is is the seem­ingly lack of in­for­ma­tion on the in­vest­ment op­por­tu­ni­ties avail­able in this sec­tor.

In the in­ter­na­tional mar­ket, there are many fac­tors that de­ter­mine prices be­tween one gem­stone and the other. For ex­am­ple, a carat of ruby can cost $10,000 de­pend­ing on its qual­ity. The bet­ter the clar­ity, the higher the cost. Also sharp coloured and smoothly cut stones at­tract higher costs. The big­ger the stone, the more it is per carat. Within each va­ri­ety, prices are based on th­ese qual­i­ties, with colour be­ing the most im­por­tant fac­tor.

Ac­cord­ing to Mrs. Winifred Ekanem Oyo-Ita, lately Per­ma­nent Sec­re­tary Fed­eral Min­istry of Sci­ence and Tech­nol­ogy, who is now the act­ing Head of the Civil Ser­vice of the Fed­er­a­tion, at a re­cent gem­stones ex­hi­bi­tion held in Abuja, gem­stones can com­mand premium prices in both lo­cal and in­ter­na­tional mar­kets only when they are care­fully cut, shaped and pol­ished. Oyo-Ita lamented that sadly, the gem­stone pro­cess­ing stage is lack­ing in Nige­ria.

“There is no of­fi­cial mar­ket for gem­stones dis­play in Nige­ria, nei­ther has there been any es­ti­mated re­serve of the quan­tity be­ing mined or traded,” she added.

Oyo-Ita fur­ther il­lus­trated the for­eign ex­change po­ten­tial of the re­source. “A Nige­rian blue sap­phire that weighed 4.03 carats was sold for $8,625 in the United States of Amer­ica re­cently. That is to say that it cost about $2,140 per carat. It there­fore shows that good qual­ity Nige­rian sap­phire can fetch a lot of money. One kilo­gram of pol­ished sap­phire is 5000 carats, hence 5,000 by 2,140 equals N2.1bn, which is equiv­a­lent of 214,000 bar­rels of crude oil at $50 per bar­rel,” she said.

In­ter­est­ingly, in Septem­ber 2014, the Ge­mo­log­i­cal In­sti­tute of Amer­ica (GIA) re­ported that a source of high qual­ity blue sap­phire was found in the Mam­billa Plateau, of Taraba State. Ac­cord­ing to the re­port, sam­ples were taken to the GIA lab­o­ra­tory in Bangkok and the rough gems were found to be not only of good qual­ity but were also avail­able in large sizes, some rang­ing from 100 to 300 carats.

From the lab­o­ra­tory anal­y­sis, the first el­e­ments that were pointed out sug­gested that the sap­phire de­posits pro­vided “a win­ning com­bi­na­tion of size, high clar­ity, at­trac­tive colour and good crys­tal habit from a cut­ter’s per­spec­tive.” The dis­cov­ery re­port­edly caused con­sid­er­able ex­cite­ment in the Bangkok mar­ket­place.

Oyo-Ita fur­ther il­lus­trated that a Nige­rian rube­lite tour­ma­line of 5.62 carats was also sold for $1,011, ap­prox­i­mately $180 per carat. Ac­cord­ing to her, “one kilo­gram of pol­ished tour­ma­line, which is 5000 carats, will sell for $180 by 5000, which equals $900,000 by N198 to give a whop­ping N178.2m, which is equiv­a­lent to 18,000 bar­rels of crude oil at $50 per bar­rel.

God­frey Uche Nwadike, an In­ter­na­tional Coloured Gem­stone As­so­ci­a­tion (ICA) for any­one will­ing to make the needed in­vest­ment.

In 2005, a home-grown min­ing in­ter­ven­tion was con­cep­tu­al­ized. The Sus­tain­able Man­age­ment of Min­eral Resources Project (SMMRP) was pro­vided with a $120m World Bank credit to in­crease gov­ern­ment’s long-term in­sti­tu­tional and tech­ni­cal ca­pac­ity to man­age Nige­ria’s min­eral resources in a sus­tain­able way. It was also meant to de­velop non­farm in­come gen­er­at­ing op­por­tu­ni­ties through smallscale ar­ti­sanal min­ing.

The im­me­di­ate past Min­is­ter of Mines and Steel De­vel­op­ment, Ar­chi­tect Musa Sada put in place a com­pre­hen­sive gem­stone de­vel­op­ment pro­gramme. It in­cluded a train­ing on gem­stones aware­ness and iden­ti­fi­ca­tion, gem­stone Ar­ti­sanal and Small-scale Min­ing (ASM) mas­ter­min­ing tech­niques, the es­tab­lish­ment of an in­ter­na­tional lapidary and the de­vel­op­ment of ge­mo­log­i­cal train­ing plat­forms and gem-buy­ing cen­tres.

But if all of th­ese de­vel­op­men­tal strides have been prop­erly put into use to achieve the de­sired re­sults re­mains an is­sue of de­bate. A gem­stone ex­pert and pro­fes­sor of Min­ing En­gi­neer­ing, Zac­cheus Opa­funso, in a re­cent chat said Nige­ria has failed to har­ness the full po­ten­tial of the avail­able gem­stones due to the overde­pen­dence on crude oil.

“The gem­stones sec­tor in Nige­ria is se­verely con­strained, with most op­er­a­tions un­guided and un­reg­u­lated. Poli­cies in place are in­ad­e­quate, and gen­er­ally gem­stone min­ers are un­trained and con­trib­ute hugely to en­vi­ron­men­tal degra­da­tion, poor qual­ity op­er­a­tional tech­niques and loss of min­er­als. This has caused sub­stan­tial losses in rev­enue to the coun­try by way of ex­ports, as well as through roy­al­ties and taxes,” he lamented.

While call­ing for a to­tal over­haul­ing of the leg­is­la­tions reg­u­lat­ing the ti­tles and li­cences for min­ing op­er­a­tors, Opa­funso be­lieved that an im­proved and ad­e­quate le­gal frame­work would phase out il­le­gal min­ing and full po­ten­tials of the na­tion’s gem­stones achieved.

In her sub­mis­sion, Mrs Oy­oIta promised that as the na­tion seeks to di­ver­sify into a non-oil rev­enue base, the gov­ern­ment would con­tinue to part­ner with rel­e­vant stake­hold­ers to cre­ate a con­ducive en­vi­ron­ment and at­tract po­ten­tial in­vestors into the solid min­er­als sec­tor through nec­es­sary in­cen­tives and sup­port. Ac­cord­ing to her, ef­forts are al­ready be­ing put in place to re­ju­ve­nate ac­tiv­i­ties in the gem­stones min­ing sec­tor to min­i­mize smug­gling and at the same time at­tract huge in­vest­ments into the sec­tor.

Il­le­gal min­ers

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