Jubilation as Nigeria sells gold, injects $5m into economy

Nigeria has recorded a commercial transaction of raw gold sales at the London Bullion Market Association, the Minister of Solid Minerals Development, Dele Alake disclosed on Sunday.

He said the sales have delivered a $5m increase in Nigeria’s foreign reserves, 70 plus kilograms of gold refined to the London Bullion Market Good Delivery Standard and successful aggregation of locally mined gold thereby injecting about N6bn 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.

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