Monday, September 26, 2022

Ban On Imported Barite’ll Boost Economy, Save US$300m – FG

barite
Barite

The Federal Government has said that the ban on the importation of barite is aimed at promoting Nigerian barites, boost the economy, create employment opportunities and save US$300million spent on barite importation annually.

During the inauguration of barite on October 28, in Rivers, it said that efforts had been concluded to not only put Nigeria on the radar of global mining communities but unlock the potentials of the nation’s solid minerals sector.

Barite is one of seven strategic minerals – coal, iron ore, bitumen, gold, limestone, lead-zinc and barite – identified by the Federal Government to unlock the potentials of Nigeria’s solid minerals sector to boost its Gross Domestic Product (GDP).

According to a NEITI report in 2018, the seven strategic minerals contributed 49.7 per cent to the total royalty generated in the year; however, barite contributed a meagre N33, 000, representing 0.001 per cent of the total royalty.

In 2020, data by Statista showed that the global production of barite was estimated to be 7.5 million metric tonnes, down from 9.8 million metric tonnes in 2012. The global barite market is valued at $1.4 billion in 2019 and is projected to reach 2.4 billion dollars by 2027.

Over the years, Nigerian barite miners have accused oil companies operating in Nigeria of economic sabotage for importing barite into the country and neglecting Nigerian barite.

They allege that despite the abundant deposits of barite in Nigeria and the Federal Government’s local content policy, international oil companies (IOCs) continue to import the mineral as a component of ‘drilling mud’, a combination of chemicals used in drilling oil wells.

They said a law stipulating that 60 per cent of barite utilised by the IOCs operating in the country be sourced locally was not being obeyed.

The Minister of State for Petroleum, Timipreye Sylva, who performed the official launch of the barite, said that imported barites would no longer be allowed for use by the Nigerian oil and gas industry from 2022.

Silva, represented by the executive secretary, Nigerian Content Development and Monitoring Board (NCDMB), Mr. Simbi Wabote, encouraged prospective investors to explore and utilise the opportunity provided by the development.

He said the utilisation of locally produced barites and drilling fluids in the Nigerian Oil and Gas Industry was in line with the Federal government’s commitments towards maximum optimisation of local content and diversification of the nation’s economy.

Wabote added that it would create huge value addition and opportunities to drive the sustainable and competitive growth of the Nigerian economy.

He recalled that the board had issued a guideline in May 2021 where it approved four firms for the supply of barites required for any drilling project or contract in the Nigerian oil and gas industry.

According to him, 10 companies will be upgraded to category A, as soon as they meet the requirements of the guidelines for the utilisation of locally produced barite and drilling fluids in the industry.

During the launch of the mineral, the Minister of Mines and Steel Development, Arch. Olamilekan Adegbite revealed that US$300million is spent on barite importation annually.

Adegbite said that 50 bags of barites were unveiled for the launch to encourage barite miners and also woo investors to invest in Nigerian barite; adding that the ministry is doing quality control on barites being produced and getting entrepreneurs to develop a robust bagging system to meet international standards.

He stated that the inauguration would end decades of importation of barites, affirming that Nigerian barite meets the API standards, which is the global specification demanded by the oil industry.

He stated that Nigeria is blessed with 47 solid minerals deposited across the country and barite is among the seven strategic minerals designated by the ministry for top-priority development.

According to Agency reports, Adegbite said that the ministry would set up a marketplace portal to connect all stakeholders along the barites value chain to a hub that allows easy coordination, stocking, effective costing and seamless sale of barite.

He added that the ministry would coordinate the process and ensure that appropriate revenues from the process are remitted to the government.

He explained that the launch of Nigerian barites would increase revenue to the government through royalty payment and conserve foreign exchange spent yearly on importing barites.

The minister said that the development would also create jobs, especially in local communities where barites are mined and processed, to earn the nation foreign exchange when the mineral gets exported.

“This process is to satisfy our local industries and also export the product to neighbouring countries such as South Africa and Ghana where oil has just been discovered,’’ he said.

The governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, said the bank is ready to support anything that would bring turn around to the solid minerals sector.

On his part, the executive governor of Rivers State, Nyesom Wike, represented by his deputy, Ipalibo Banigo, felicitated with the ministers for the feat achieved and thanked them for choosing the state for the inauguration.

The director-general, Nigerian Geological Survey Agency (NGSA), Mr. Abdulrazak Garba, said Nigeria stands to gain more in the future with this development, as there are prospects for more barite beneath the country’s land space than the estimated 22 million tonnes because the barite mineralisation being worked on now is only within a depth of 30 metres, even amidst signs that there are deposits beyond that.

According to him, after careful assessment, 12 processing companies were engaged to add value to Nigerian barite locally, and Rivers was chosen as the venue for the launch because it is where the mineral is mostly used for oil exploration.    (NAN)

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