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The Nigerian government plans to generate 1000 megawatts of electricity from coal by 2020 to supplement other energy sources in the country
| By Anayo Ezugwu | Apr 4, 2016 @ 01:00 GMT |
NIGERIA is planning to generate 1000 megawatts of electricity from coal by the year 2020 to supplement other sources of energy currently used in the country. Kayode Fayemi, minister of solid minerals development, who disclosed this at the economic summit organised by the New Telegraph newspapers with the theme, “Nigeria: Beyond the Oil Economy,” in Lagos, said the diversification of the nation’s economy has been yielding positive results, with the country earning about N400 billion from solid minerals in 2015, according to the Central Bank of Nigeria, CBN.
According to him, “Coal exploration offers a significant opportunity for power generation and one of the efforts that we are making now in partnership with the ministry of power, works and housing is ensuring that coal forms a significant part of the energy needs. I know there are people who are worried about climate change and the implication of coal on that. But even coal can achieve clean coal environmental standard and we believe that about 1000 megawatts of electricity can be generated from coal by the year 2020. And these are plants that are going to be sited near the areas where the reserves are, across the country,” he said.
Coal production started in Nigeria in 1902 and it was the main energy source for our country until 1960, and coal is in about 19 states of the federation stretching for about 800 kilometres
Fayemi noted that some reforms arising from Nigerian Mining and Minerals Act 2007 have created a platform for a robust private-sector-led mining industry in the country. “The mining sector has been with us since 1902. From the early operations of the geological surveys emerged entities such as the Nigerian Mining Corporation, Nigeria Coal Corporation and the National Steel Company. And during this period, mining was a major contributor to Nigeria’s revenue base and was a leading employer of skilled and unskilled labour.
“But we then lost it, we forgot all about mining, and the Indigenisation Decree, particularly in 1972, contributed to the demise of mining in the country. Because that’s when most of the expertise that we had in mining, which was essentially foreign, mostly British, left the scene, and we lost our tracks as far as mining was concerned. But following some reforms which started in 1999, which essentially crystallised around the Nigerian Mining and Minerals Act 2007, Nigeria is once again on the path to providing a transparent and workable regulatory and policy environment for more robust private-sector led mining.”
One of the major challenges confronting the mining sector is finance. The banking industry does not understand mining. “Less than one percent of the loan that is on offer in the banking sector goes to mining. In fact, our banking industry does not understand mining at all. Apart from the Bank of Industry, BoI, that has now started some work in this regard, only two banks in this country have mining desks – Stanbic IBTC and First City Monument Bank, FCMB.
“On becoming minister, I had to go the Bankers Committee to talk to all bank MDs, courtesy of the CBN governor, to encourage them to set up mining desks in their banks and also get involved in similar interventions schemes which exist in agricultural sector but does exist in mining yet, it will come. We are determined to have funding structures that can support genuine mining, and over the course of the next six months a lot more will be heard of what we are doing in this sector. But banks are also showing interests because they see that it is a priority area for the government,” he said.
Similarly, Godwin Emefiele, governor, CBN, declared at the event that the N400 billion earned from solid minerals in 2015 underscores the great prospects of the nation’s non-oil economy. Emefiele, who was represented by Sarah Alade, deputy governor, Economic Policy, CBN, noted that although the challenge of diversification of the Nigerian economy is daunting, it is by no means insurmountable. “The prospects are great with the potentials in the agricultural, solid minerals and the creative industry sectors.
“The country is endowed with abundant arable land capable of supporting all-year-round production of a wide variety of both cash and food crops, livestock and forestry. By its geographical location along the coast of the Atlantic Ocean, and myriads of water-ways, it has huge potentials for fish production to meet domestic need and surplus for exports in a global fish market valued at $144 billion in 2014. In the solid minerals sub-sector, there are at least 44 known mineral assets notably gold, iron ore, barite, bitumen lead, zinc, tin and coal which have been identified for commercial exploration,” he said.
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