Nigeria risks repeating oil-era failures in minerals sector, expert warns

Tengi George-Ikoli, Nigeria Country Manager at the Natural Resource Governance Institute (NRGI)

Nigeria risks reproducing the economic and environmental failures of its oil industry in the development of its solid minerals sector unless it strengthens regulation, improves resource management and ensures host communities benefit from extraction, an expert has warned.

Tengi George-Ikoli, Nigeria Country Manager at the Natural Resource Governance Institute (NRGI), said the country had failed to translate nearly seven decades of commercial oil production into broad-based economic development.

“We have not,” Mrs George-Ikoli said when asked whether Nigeria had benefited from its petroleum resources.

She spoke in an interview with PREMIUM TIMES on the sidelines of the ongoing COP31 climate conference in Antalya, Türkiye.

She said although oil and gas had remained important sources of government revenue and foreign exchange, successive governments had failed to use the proceeds to build other productive sectors, create sufficient jobs and improve conditions in oil-producing communities.

The scale of the country’s dependence is reflected in its extractive sector’s contribution to public finances and trade.

Nigeria’s 2023 Extractive Industries Transparency Initiative (EITI) report showed that extractive industries accounted for 54.4 per cent of government revenue and 82.52 per cent of exports.

Yet, Mrs George-Ikoli said, communities where extraction takes place continue to contend with poverty, unemployment and environmental damage.

She warned that Nigeria could repeat these failures as it seeks to attract investment into minerals increasingly important to global energy and industrial supply chains.

Nigeria’s solid minerals sector remains small compared with its petroleum industry.

The 2023 Nigeria Extractive Industries Transparency Initiative Solid Minerals Industry Audit Report put its contribution to gross domestic product at N1.76 trillion, or 0.75 per cent.

The report also recorded mineral exports of 4.32 million metric tonnes, valued at N117.29 billion, while royalties amounted to about N9.01 billion.

Mrs George-Ikoli said the country should not assume that mineral wealth would automatically deliver economic diversification or replace oil revenues.

In an August 2026 report co-authored by her, NRGI similarly cautioned that mining projects could take years to develop and might generate less public revenue and employment than governments expect.

She said Nigeria needed to strengthen the institutions governing the sector before expanding investment, pointing to the Nigerian Minerals and Mining Act of 2007 as a framework that requires reform.

“We need to strengthen our governance structures. It took us how many years to reform that in the oil and gas sector with the Petroleum Industry Act,” she said.

She identified effective regulation, transparent licensing, a sound fiscal regime and reliable geological information as priorities.

According to her, Nigeria must establish what minerals it has, where they are located and whether they exist in commercially viable quantities before negotiating with investors.

“We need to provide data. We need to really map out where our resources are, what it is that we have, in what level of commercial quantities as well, what sort of value, so that as we continue to have increasing investments or interest in us, we will be able to negotiate better for Nigeria,” she said.

She also stressed that communities must have a meaningful role in decisions about extraction and a fair share of its benefits, warning against reproducing the weaknesses she sees in the host community development trust arrangements under the Petroleum Industry Act.

Mrs George-Ikoli said Nigeria should pursue mineral processing and value addition where commercially viable, rather than insist on processing every mineral locally regardless of available resources or capacity.

She advocated cooperation among African countries, including the Democratic Republic of the Congo, Zambia, Ghana and Uganda, to develop regional processing and manufacturing industries.

She said Nigeria’s market size and industrial potential could position it as a regional processing hub, while collaboration with other mineral-producing countries could strengthen Africa’s bargaining power in global supply chains.

“We are feeding global supply chains, but we’re not really benefiting as much as we could individually,” she said.

She argued that countries working together could retain more economic value from their resources and create technical jobs beyond raw mineral extraction.

Beyond mining, Mrs George-Ikoli questioned whether Nigeria’s ambitious gas expansion plans adequately reflect production constraints and changes in international energy markets.

The country’s Decade of Gas initiative seeks to expand production and develop a gas-powered economy by 2030. However, an NRGI report published in September 2026, co-authored by Mrs George-Ikoli, found that Nigeria was unlikely to achieve its target of adding 4.6 billion cubic feet per day of gas production by 2030.

Even under the report’s most expansive scenario, additional production would reach about 1.3 billion cubic feet per day.

Mrs George-Ikoli said Nigeria also needed to consider how much of its future gas supply would meet domestic needs, including electricity and industrial development, rather than be directed towards exports.

She warned that investments in long-term oil and gas projects could become less commercially attractive as global energy markets and regulations change.

She called for greater investment in renewable energy and other productive sectors, alongside plans to support workers and communities affected by the energy transition.

She said these priorities should feature in Nigeria’s national development plans and future climate commitments, as well as ongoing negotiations on the Just Transition Work Programme under the United Nations climate process.