"N5 Million for a License to Refine Gold” FG Increases Cost of Mining Lease in Nigeria
- The price of mining permits and royalties has been raised by the federal government
- The Solid Minerals Development Minister Dele Alake said the pricing regime consists of 268 elements
- According to him, investors will obtain a mineral processor if they are prepared to pay N5 million for a license to refine gold
Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.
The federal government increased royalties by 100% on Thursday. Additionally, the government increased the cost of mining licenses among other things.
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The details were provided by Solid Minerals Development Minister Dele Alake during an Abuja media briefing.
Alake said,
“We are taking a major step in the efforts to implement the seven-point agenda to position the sector for economic consolidation and international competitiveness by announcing a new regime of rates and charges for various services of the departments and agencies of the ministry.”
“This is in view of the introduction of qualitative measures and human and technological capacity upgrades implemented in recent times to raise the level of technical efficiency of the services, improve the traffic of transactions and develop infrastructures to cope with the resurgence of business interests in the sector.”
According to the minister in a BusinessDay report, the pricing regime consists of 268 elements. But he simply brought attention to the significant increases.
He said,
“Applicants for Mining Lease will pay N3 million; Reconnaissance Permit, N300,000, Exploration Licence, N600,000, Small Scale Mining License, N300,000, Quarry Lease N600,000 and Water User Permit N300,000.”
“Annual Service Fee now N31,500 per Cadastral Unit for the first time, Small-Scale Mining. N260,000; Quarry Lease, N500,000, Mining Lease, N1,250,000.”
The Minister went on to say that the following penalties would apply to late mineral title renewals: N600,000 for the reconnaissance permit, N1,500,000 for the exploration license, N3,000,000 for the mining lease, and N1,500,000 for the quarry lease.
He added that the royalty rate will now cost 100% higher per standard weight of minerals. For example, a tonne of baryte has a market value of N42,000 and a royalty of N2,100; a tonne of coal has a market value of N3,000; a tonne of gold has a royalty of N36,436; a tonne of lead/zinc concentrate has a market value of N480,000 and a royalty of N14,400.
With a current market value of N600,000 per tonne, lithium ore (lepidolite) is subject to a royalty of N18,000 per tonne; lithium (kunzite) is subject to a royalty of N90,000 per tonne; and lithium ore (spodumene), with a current market value of N316,667 per tonne, is subject to a royalty of N9,500 per tonne.
Currently, it costs N20 million to obtain a license to produce explosives, N10 million to alter explosives, and N500,000 to sell explosives for mining.
He added that a permit to operate a mineral processor costs N100,000, and investors who are willing to spend N5 million for a licence to refine gold will receive one. Nigeria's geological map currently costs N300,000, while the country's map of mineral resources will cost N500,000.
Manufacturers, Farmers, SMEs to Stop Paying Withholding Tax
Legit.ng reported that to lessen the tax burden on enterprises, the federal government has approved exempting manufacturers, farmers, and small businesses from paying withholding tax.
To lessen the tax burden on enterprises, the federal government has approved exempting manufacturers, farmers, and small businesses from paying withholding tax.
Important modifications to the previous tax system were also implemented, including lower rates for companies with narrow profit margins and steps to prevent tax cheating.
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Source: Legit.ng
