The Minister of Solid Minerals Development, Dele Alake, revealed on Sunday that Nigeria has successfully conducted a commercial transaction of raw gold sales at the London Bullion Market Association. This transaction has resulted in a boost of $5 million to Nigeria’s foreign reserves, with over 70 kilograms of gold refined to meet the London Bullion Market Good Delivery Standard. Additionally, the aggregation of locally mined gold has injected approximately N6 billion into the rural economy.
Alake disclosed this while presenting the latest gold bar
sourced from artisanal and small gold miners and refined by the Solid Minerals
Development Fund to President Bola Tinubu during the weekend.
The minister in a statement signed by the Special Assistant
on Media, Segun Tomori, said the refined gold would be sold to the Central Bank
of Nigeria to bolster foreign reserves.
Nigeria reportedly has about 600,000 tonnes of gold
reserves, worth about $45bn located in several states including Zamfara, Edo.
However, the upsurge of illegal mining has led to a notable
diversion of the nation’s commonwealth into the hands of private individuals,
thereby diminishing resources intended for public benefit.
Three years ago, former president Muhammadu Buhari declared
Zamfara State a ‘no-fly zone’ as part of efforts to curb the problem of illegal
gold mining.
At the event, Alake commended Tinubu for supporting reforms
in the solid minerals sector, assuring that the National Gold Purchase
programme will increase the country’s reserve and boost the naira’s value.
Explaining to President Tinubu the significance of the
event, Alake said it marked the first commercial transaction under the National
Gold Purchase Program, the centralised offtake scheme supported by a
decentralised aggregation and production network of artisanal and small-scale
miners and cooperatives.
He said, “The successful completion of the first commercial
transaction demonstrates the National Gold Purchase Program’s effectiveness. It
has increased the nation’s foreign reserves assets and shown that using the
Nigerian Naira to purchase a liquid asset traded in United States Dollars, such
as gold, is a viable strategy. This transaction has also underscored the
potential of the National Gold Purchase Program to enhance fiscal and monetary
stability.”
Receiving and displaying a symbolic bar, Tinubu commended
the Ministry for achieving a major milestone in the administration’s drive to
diversify the economy.
“This is another concrete step towards the diversification
process under the Renewed Hope Agenda,” the President said.
In her presentation, the Executive Secretary of the Solid
Minerals Development Fund, Fatimah Shinkafi said the London Bullion Market Good
Delivery Standard is the globally recognised stringent and trusted standard
that enables the global trade in gold and silver bars.
“Only gold and silver bars that meet our Good Delivery
standards are acceptable in the settlement of a Loco London contract – where
the bullion traded is physically held in London” she said.
Shinkafi said, that through the efforts of the National Gold
Purchase Program under the Ministry of Solid Minerals Development, Nigeria has
joined a select group of countries bolstering their gold reserves by purchasing
gold in local currency to foster economic confidence, enhance currency
stability, and create a more attractive environment for foreign investment.