Nigeria’s minister of mines said on Wednesday that 924 expired mining licences had been cancelled immediately.
The country now wants investors to apply for the affected permits, which will be given out on a “first come, first served” basis.
In a statement, Mines Minister Dele Alake said that 528 exploration licenses, 20 mining leases, 101 quarry licenses, and 273 small-scale mining licenses would be impacted.
As part of major changes in the mining industry, more than 1,600 mining titles were taken away in November for not paying the required fees.
Alake said that the action was taken to stop “licence racketeering,” which is when people or businesses buy titles to minerals that are worth a lot of money and then sell the licenses to the highest price.
“By creating a secondary, black market to pawn mineral licences, the unsuspecting and unwary investor is misled into believing that he can only obtain licence by patronising the black market. This discourages investment,” Alake said.
“It is our belief that this decision will sanitise the licensing system by penalising those who have commercialized the opportunities offered by the sector into a bazaar, he added.
Nigeria wants to attract investors to a mining industry that hasn’t been developed much in the past. To do this, they are giving incentives like not having to pay taxes on profits and sending them back to Nigeria in full.
Nigeria has had trouble getting value from its huge mineral riches because it didn’t invest in or take care of them.
After making it harder for foreign companies to get mining licenses last year, Africa’s biggest oil provider will only give them to companies that process their minerals in the country itself. The country is also rich in lithium, gold, and limestone.