Guardian Nigeria
As the global demand for critical minerals crucial for energy transition grows, Nigeria’s mining sector grapples with supply to meet challenges of low carbon amid widespread corruption, which threatens the country’s potential to meet the surging need.
With Nigeria’s richness in critical minerals such as lithium, cobalt and rare earth elements vital to producing batteries, electric vehicles and renewable energy technologies, the country has the potential to become a major supplier of critical minerals to the global market. However, there is a crisis of increasing supplies to meet the challenges of low carbon as the energy transition is driving rapid growth in critical minerals demand.
Speaking at the two-day JET Minerals Challenge Workshop on the theme, Chief Executive Officer of the Centre for Journalism Innovation and Development (CJID), Dapo Olorunyomi, said crime and corruption are significant obstacles to achieving renewable energy objectives in Africa.
He added that strong demand growth in the mineral sector and efforts toward decarbonisation attract new investments in the downstream sector, which in turn, increases the exponential risks of corruption.
“As prices of minerals go up, creating a boom, corruption risks rear up in licensing consent, money laundering, smuggling, bribery and tax. There is a need for a concerted approach involving state, markets and citizen actions needed to identify and mitigate corruption risks through the promotion of transparency ethos, accountability of actors, replication of consensus that had worked in creating mechanisms around biodiversity, human rights and nature safeguards in the terrain of corruption, crimes and tax evasion,” he said.
Corruption in the mining sector includes the abuse in licensing applications and approvals, lack of transparency in the beneficial ownership of licenses, opaque or incomplete details on contracting and double allocation of licences. Others are duplication of consent letters from communities, politically exposed persons abusing the process, underreporting of mining activities by operators, using exploration licenses to commence mining and the smuggling of minerals as well as precious stones.
Executive Director of CJID, Dr Tobi Oluwatola, said that energy transition is driving rapid growth in the demand for critical minerals as electric car sales increased by 60 per cent in 2022, exceeding 10 million units.
