The Nigeria Extractive Industries Transparency Initiative (NEITI) has said that Dangote Cement Plc and Dangote Industries Limited were the best in solid minerals royalty remittances to the Federal Government’s coffers in 2019, beating Lafarge Africa Plc, Julius Berger, Reynolds Construction Company, among others.
According to NEITI’s 2019 audit signed by its executive secretary, Orji Ogbonaya Orji and released on Tuesday, the two companies under the Dangote Group, contributed about N778.28 million out of N79.96 billion royalties remitted for the year from the solid minerals sector.
Specifically, while Dangote Cement’s revenue contribution to the Federal Government stood at N635.52 million, Dangote Industries Limited’s revenue was N142.76 million, representing 25.40 percent and 5.71 percent of the total revenue received by the government within the period under review.
According to the report, out of 702 companies that paid royalties to the government in 2019, only 74 companies met the materiality threshold of N3 million.
“These 74 companies accounted for 87.63 percent of total royalties of N2.50 billion paid in 2019, with the top five companies (Dangote Cement Plc, Lafarge Plc, Dangote Industries, Julius Berger, and Reynolds Construction) paying more than 50 percent of total royalties” the report stated.
An analysis of revenue flows from the sector also showed that the sum of N79.96 billion recorded in 2019 was the highest in the past five years. This was followed by N69.47 billion and N69.2 billion recorded in 2018 and 2015 respectively. Besides, N52.76 billion was recorded in 2017 while the sector accounted for N41.98 billion in 2016.
On minerals exported, the report showed that the solid minerals sector accounted for N124.23 billion of the total government exports of N24.275 trillion for 2019, representing 0.51 percent of total export for the year.
On contribution of the sector to the economy, NEITI’s report cited data from the National Bureau of Statistics (NBS) which stated that mining and quarrying contributed 0.26 percent to GDP, higher than 0.18 percent contribution recorded in 2018.
“Nigeria’s GDP in 2019 was N144.210 trillion with contributions from the solid minerals sector totaling N368.99billion, representing 0.26 percent of the total amount”. This shows a steady growth in the sector’s contribution to the economy in the past five years, from a contribution of 0.12 percent in 2015 to 0.26 percent in 2019.
A sectorial review of revenue distribution of taxes and royalties by the 74 companies shows that manufacturing and construction companies contributed 68.60 percent and 29.67 percent respectively in royalty and taxes while quarry, mining companies and buying centres contributed only 1.73 percent.
On environmental impact and social expenditure, the report disclosed that ten (10) companies reported environmental expenditures to the tune of N17.13 million. The expenditure covers environmental fees, air quality and waste permits, and registration fees for environmental impact assessment (EIA).
Furthermore, the report disclosed that Mines Environmental Compliance Department carried out reclamation of seven abandoned mines costing N534.81million. It also noted that a total of 32 mining sites have so far been reclaimed from 2007 to 2019 costing N2.39 billion.
On social expenditure, the report revealed that the sum of N2.598 billion was spent on 557 projects by 44 extractive companies.
