Sekibo Identifies Prospects in Nigeria’s Gold Market

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Heritage Bank Plc has estimated that Nigeria’s gold market is worth £4 billion with high prospects of profitability for all players in the sector.

The MD/CEO of the bank, Ifie Sekibo, stated this at the Nigeria-Canada Investment Summit, held in Abuja, recently.

He disclosed that the enormous potential of the industry was one of the reasons why the bank delved into the mining sector despite enormous risks. According to him, the bank has Dukia Gold as its partner that would facilitate access to local miners and artisans to get value for their commodity at international market price after being registered with Dukia Gold.

According to a statement, Sekibo, who was represented by the Team Lead, Agric Finance and Export, Heritage Bank, Adelana Ogunjirin, explained that previously, local gold found it difficult to trade their commodities favourably. But he pointed out that with the involvement of Dukia and its partner, Heritage Bank, a Quality-and-Quantity test would be conducted based on the arrangement they made with Dukia Gold and that would lead to additional value to the small holder miners. He explained that this would leverage the small miners the opportunity to also trade their commodities at international market price.

He further stated that a metric tonne of Gold is currently valued at $30 million, adding that it was worth investing in the industry, especially as gold is a kind of commodity that does not easily lose its value.

He said: “Mining sector is an area which has not been fully tapped in terms of the potentials around it, as there are quite a lot of opportunities around that sector. Recently we secured $1 billion funding line with our funding partner AfreximBank, which also is to support areas like solid minerals.

“Now with respect to this we have looked at the value chain of this space and we have looked at the opportunities that are there. A lot of fund providers have not really delved into this and it is because of the lack of understanding of the market.

“In terms of value, gold is an area where you can enhance the value. You hardly see Gold losing value and you see that in different exchanges you even trade those commodities.

“Looking at it in terms of trend, you see that gold is something that will appreciate definitely. So in terms of the profitability of this business, we have looked at it, the crunch, the numbers we see that is a space that the Bank will definitely earn a lot of income.”

He also expressed optimism that other banks would like to come into the Nigerian mining sector, but may be studying to understand the sector properly.

“Definitely other banks will come into the sector. For us we are leading, but the truth is they need to play in an area and space that they understand, as not everybody would be able to play in that space.

“Heritage Bank has already carved a niche for itself in agribusiness space, just like the Gold commodity, this would be exported. So, in terms of export proceeds too, there are opportunities to be explored. Generally, looking at the Nigerian outlook, on the long run, this will also enhance the country’s external reserves. There are multiplier effects of what we are doing today and that is why we are also moving in this direction,” the MD noted. 

Also speaking, Managing Director, Nigeria Export-Import Bank, NEXIM, Abba Bello, revealed that the bank had gone into high level discussions with heavy equipment manufacturers and suppliers that would lease equipment to miners for exploration and processing, adding that this was expected to make the equipment accessible and affordable.