Senate Seeks Probe of $9bn Annual Revenue Loss to Illegal Mining

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Queries permanent secretary over payment of N460m for uncompleted projects

By Chuks Okocha

The Senate yesterday charged the executive arm of government to investigate the alleged annual revenue loss of $9billion to illegal mining and smuggling of gold in Nigeria.

Specifically, the upper legislative chamber urged the federal government to intensify efforts to combat illegal mining and block all revenue leakages from such ‘clandestine activities’ as well as establish gold mining farms to assist artisans and miners.

It also mandated its Committee on Solid Minerals, Mines, Steel Development and Metallurgy to investigate all illegal mining and revenue leakages associated with the activities.

These resolutions were sequel to a motion sponsored by the Senate Chief Whip, Dr. Orji Uzor Kalu, during plenary.

Senator Kalu, while presenting the motion, noted that: “Nigeria lost close to $54billion from 2012 to 2018 due to illegal smuggling of gold. The country is said to be losing about $9billion yearly to illegal mining and gold exportation, a huge amount of money unaccounted for through the sales of the expensive commodity.”

The Abia North lawmaker added that “the activities of unlicenced miners were becoming prevalent in the industry, and also, the incessant smuggling of solid minerals out of the country by middlemen and smugglers is leading to loss of government revenue.”

According to the former governor of Abia State, gold mining operations in the country is capable of providing over 250, 000 jobs and over $500million annually in royalties and taxes to the federal government and also as mineral resources.

This, Kalu explained, would further help in diversifying the country’s economy and improve its foreign exchange reserve.

He said: “Given our current estimated gold reserves of over 200million ounces, most of which have not been exploited, developing sustainable programmes that would catalyse increased investment in the extraction and refining of gold sourced from mines in Nigeria is indeed vital.”

While quoting data from the Ministry of Solid Minerals and Steel Development, on gold deposits in Abuja, Abia, Bauchi, Cross River, Edo, Niger, Sokoto, Kebbi, Oyo, Kogi, Zamfara, Osun and Kaduna States, the senator said Section 44(3) of the Nigerian Minerals and Mining Law of 1999 provides that ownership and control of all minerals is vested in the federal government, which is mandated to manage such natural resources in a manner as may be prescribed by the National Assembly.

In his contribution, Senator Smart Adeyemi (APC Kogi West) also stressed the need for the government to seal up illegal mining activities, adding that that has added to the insecurity challenges facing the country, “because most of the miners are foreigners.”

The Upper Chamber yesterday also queried the Permanent Secretary of the Ministry of Information and Culture, Mr. Nebolisa Anako, for paying the sum of N460 million to contractors without completing the projects.

Senate’s action was sequel to the 2015 Auditor General of the Federation’s report, indicating that 100 percent payment was made to the contractors.

The query by the Senate Committee on Public Account chaired by Senator Mathew Uhroghide ( PDP Edo South), reads: “A constituency project contract amounting to N51 million for the construction of roads, parking lots, drainage at Ureje Dam in Ado Ekiti showed varrious part of the contract totaling N25.5 million were paid for but not executed.

“The ministry should ensure the contractor either completed the work or refund the money collected and forward the recovery particulars for audit verification.”

In his written response, the permanent Secretary said, “the contractor has completed 60 per cent and promised to hand over the projects on or before 30th June 2017 to the ministry vide the minutes of the meeting held with the contractors handling the contracts on the 20th April, 2017”.

However, the contractor is yet to complete the project as at the time the Permanent Secretary of the Ministry appeared before the Committee on Tuesday, December 8, 2020.

The Chairman of the committee expressed dissatisfaction with the way the contract was handled by the ministry and ordered the Permanent Secretary to go and get the contractor and complete the job.

He said, “He was paid, he did not do half of the job and go and get him to complete that job until this man does this job, you will never have respite, whether it is constituency project, it is irrelevant.

Also in another query which reads, “A visit to a contact amounting to N132 million for construction of Ureje Dam waterfront scheme in Ado-Ekiti of Ekiti State, revealed that some parts of the contract amounting to N5 million were paid for but not completed.

“A visit to a contract amounting to N138 million for the construction of Event centre/Restaurant at Ureje Dam waterfront scheme in Ado-Ekiti, Ekiti State, which was fully paid, showed that the contract was not completed.”

The Permanent Secretary was, however, not able to convince the Committee that tbe contracts were completed and the lawmakers sustained the query.

Also in another query, the Senate queried the Ministry payment of N17 million for uncompleted project for the construction of fence at Exekuna cultural museum in Nchi-Onu, Amuzu Ezza Local Government in Ebonyi State.

The Committee said: “The contract amounting to N6 million was not constructed. As a result, all over the fence, some parts were also broken in the site.

“Audit inspection visit to a contract amounting to N122 million for construction of fence, gate House at Ureje Dam waterfront scheme in Ado Ekiti of Ekiti State, revealed that painting and external electrical works being part of the contract were not completed.”

“The ministry should ensure that the contractor complete the work or refund the appropriate amount involved.”