The Federal Government of Nigeria, through the Solid Minerals Development Fund (SMDF), has signed a major Memorandum of Understanding (MoU) with the Africa Finance Corporation (AFC) to co-finance three key initiatives in the solid minerals sector, headlined by a $1.3 billion alumina refinery project.
The agreement, described by officials as a transformative step for Nigeria's mining industry, includes:Construction of a state-of-the-art alumina refinery capable of processing approximately 1 million tonnes of bauxite ore annually.
The facility will employ a modern Bayer-process flowsheet and feature an on-site gas-fired cogeneration plant to produce steam and power efficiently.
A comprehensive nationwide geoscience mapping exercise to generate detailed mineral data, reduce exploration risks, and unlock untapped potential.
Establishment of a joint strategic investment vehicle to accelerate exploration, development, and commercialization of priority mineral assets.
Alumina, derived from bauxite ore, serves as the primary intermediate material in aluminum production, comprising aluminum oxide used globally in industries ranging from transportation to construction.
The project is projected to become Nigeria's largest private-sector investment in mining history and a significant foreign direct investment inflow.
Estimates indicate it could contribute $1.2 billion annually to GDP, inject over $25 billion into the economy over its lifecycle, and generate approximately $8 billion in foreign exchange earnings.
Hajia Fatima Shinkafi, representing the SMDF, hailed the deal as a "phenomenal milestone," noting that the $1.3 billion capital expenditure demonstrates the Fund's maturity in partnering with institutions like AFC to advance the Minister of Solid Minerals Development Dele Alake's value-addition agenda.
Minister Alake described the pact as a "landmark breakthrough" that will help shift Nigeria from raw mineral exports toward higher-value processing, boosting economic diversification beyond oil.
The MoU follows extended negotiations between AFC and SMDF, with the government committing to fast-track permits and regulatory approvals to ensure timely implementation.
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