Dangote cement plc vs BUA cement: The fight over gold deposits in Edo state


From pre-independence to post-independence, Obu River has been a gold mining area of Afemai land. Akoko Edo and Owan are also gold mining areas in Afemai land of Edo North. I challenge the two companies who are fighting over Obu mines to provide a laboratory for testing solid minerals in Nigeria if actually they are sincere in their mining operations. The fight over Obu mines is beyond limestone because it has exposed the corruption in Nigeria’s solid minerals sector where there is no laboratory to test the solid mineral you are exporting. I challenge the two companies to allow international mining companies to get access to Obu mines to test the mineral deposits they are fighting over in Okpella. My investigation revealed that the two companies are fighting over gold deposits and not only limestone. There is limestone deposit in all parts of Okpella. What made Obu mines special is the presence of gold in large quantity. The right to ownership of the mines has further exposed the corruption in Nigeria’s solid minerals sector before the international community.

Managing Director of BUA Obu Cement Company, Engineer Yusuf Binji has been declared wanted by the Nigerian Police over an alleged attack on the convoy of Mr Godwin Obaseki, Governor of Edo State. Some officials of the Edo State Government and, the member representing Etsako Federal Constituency in the House of Representatives, who were also on the convoy of the governor, were also attacked by the cement company. In a statement issued by the Special Adviser on Media and Communications to the Governor, Mr Crusoe Osagie made known that the move was a follow-up to intelligence reports that suggested the mining guru was training militias in the Edo North location of the company. “According to the police, the decision to declare Binji wanted became necessary as it had earlier received intelligence that BUA International Limited is sponsoring militias in Okpella, Edo State, where the company has a cement factory and mine sites.
Some people of Ukhomunyio, Okpella, whose community is hosting the disputed mines told me when I visited the community in Etsako East Local Government that the two companies have discovered gold in Okpella and that is the reason both companies have resorted to the use of youths as militia to enforce perceived rights to ownership of the mines and thus creating security threat to the peace of the people. The people told me that the dispute is beyond limestone deposit. Some members of the community told me that the dispute between Dangote Cement and BUA is about mining gold and this is the reason you have illegal miners even when the Governor ordered the closure of the mining sites. The community and the companies are involved in illegal gold mining with impunity. John Shehu, a native of the village told me that two people cannot lay claim to one asset but the struggle for gold is responsible for the crisis in Okpella and the contentious matter as this with recourse to self help”. The Community heads disclosed that the youths of the Community are being incited against one another in a bid to enforce perceived right to ownership of the mines, a situation they said generated tension in the area.

The ownership of Obu mines has been a subject of dispute between the Africa’s leading Cement manufacturers, Dangote Cement Plc and Bua Cement, which the Federal Ministry of Mines had asked to vacate the mines because they were exploiting limestones in the area illegally. The Federal Government lamented that the country lost about $9billion in two years on illegal mining particularly on gold exportation. The nefarious activity had made the country to lose huge sums of money that was supposed to grow the Gross Domestic Product, GDP. “People are selling gold daily in Nigeria, but we don’t have a record of what is being sold, and these are the kind of issues that we think we need a proper framework to begin to address.” A sector that is 80% artisanal, as things stand, is grossly underdeveloped.
For decades, the simple act of testing the quality of these minerals is mainly out of our hands — it requires ISO standard if investors are to take us seriously or get excited at all. The government should work with the SGS, the mineral inspection company, to revive the laboratory in Kaduna and bring it up to ISO standard so that we can start testing the minerals here at home, “rather than taking them out to Australia, Canada and other places. Okpella as the mineral gem of Edo state, the people do not know the mineral resources that miners are taking away from Edo State since there is no laboratory in Nigeria to test such minerals.

Edo State Solid Minerals today are monopolized by some companies. They have taken over the solid mineral deposits in Edo North even when they are not involved in mining. They acquired mineral deposits and lease to other companies. One control Ikpeshi, two controls Atte and Uneme while another controls Egbigele mining sites. Also, they encourage illegal miners by sub letting the various deposits to quark miners who give them commission in return. Available records have it that many factories in the same area and resort to buying crude from these illegal miners since there is no availability of vacant deposit. This goes a long way in minimizing the number of people employed by these factories.
I have spotted foul play in the computation and payment of royalties by the operators in the Edo’s solid minerals sector. Edo has lost huge amount of money to faulty royalty payments in the solid minerals sector, The benchmark used for the calculation of royalty payments are not the current market value in the solid minerals sector. The amount used for the calculations of royalty payment for all mineral deposits were long overdue for review.
I want to highlight the monopoly of quarry sites and mining companies as part of the challenges of the sector. I want to blame the leakage of royalty payment on the lack of synergy among the federal and state mining departments allowing illegal mining to flourish. From available records of Central Bank of Nigeria, companies exported metric tonnes of minerals. Despite the fact that solid mineral were being mined across EDO State, there is no record to show that these minerals are among the mined or exported minerals. Further finding shows that minerals are mined in Edo state, there are no record of royalty payments.
From the available records of the Ministry of Solid Minerals, there were no evidences of royalty payment on these exported minerals. The Nigeria Minerals and Mining Act 2007 require that any exporter of solid minerals must request for permit to export minerals. But in defiance to the Act, there is no available evidence of request for permit or approval to export minerals by the companies. The informal players are mostly artisan miners, medium scale operators and illegal miners who hardly keep any record. Some of the minerals mined in EDO are exported out of the country by both formal and informal players. There are no official records from ministry of Solid Minerals on the actual volume of minerals exported out of EDO between 2011 and 2017.

I want to appeal to Governor Obaseki to investigate how much revenue is Edo getting as derivation from solid minerals. Despite the fact that gold, diamond, marbles and other solid minerals are being mined in Akoko Edo, Edo State and there is no record to show that these minerals are among the mined or exported minerals in Edo State. My further finding shows that solid minerals are mined in Etsako West, Etsako East, Owan East, Owan West, Akoko Edo and Ovia South West Local Governments, they are also purchased by multinational oil companies as drill fluids, despite high activities of miners there are no records of royalty payments and derivations paid to Edo State. Governor Obaseki needs to find out the powerful individuals that now control solid mineral deposits in Edo. The truth today is that potential investors cannot get deposits to mine even after obtaining mining license from Federal Ministry of Solid Minerals in Abuja.
The challenge before Governor Obaseki in the Edo Solid Minerals is to ascertain how many companies that illegally bought the solid mineral deposits in Edo State. How comes that investors with licenses have no deposits to mine in Edo? How many companies that are operating in the Edo solid minerals? How many companies that are paying taxes and royalties to the federation account? How much revenue is Edo State receiving from federation account as derivation from solid minerals? In term of corporate social responsibility, what are the companies doing in their various host communities?

Federal, states and local governments are losing huge amount of money annually from untapped and tapped resources that abound in the nation’s soil. Nigeria is estimated to be losing about N8 trillion annually from untapped gold. The estimates are monies that should have accrued to the federation account from royalties, taxes, charges and other fees from companies and individuals operating in the solid mineral sector if the Federal Government had paid enough attention to the development of solid minerals in the country.
Edo solid minerals sector has greater capacity to generate revenue than oil. Edo has large deposits of untapped solid minerals. But with the declining revenue from oil, the Federal Government and Edo have to opt for diversification of the economy, making solid minerals one of the sectors to focus on. Governor Obaseki should make attempt to diversify the Edo economy and make it less dependent on oil as its major revenue earner. “The reduction in global crude oil prices is not expected to cease at least in the short run, thus the need to diversify the economy. One key sector which offers great potential in achieving this is the solid minerals sector.



Inwalomhe Donald writes from Okpella, Edo State, inwalomhe.donald@yahoo.com

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