Bose Owolabi, an astute precious metals trader, management expert, and transport and logistics specialist, is the Managing Director of Dukia Gold. In this interview with John Osadolor, Ladi Patrick-Okwoli, and Joy Jimoh, she speaks on the need for the government to create an enabling environment for mining to thrive and for Nigerians to own gold as an investment asset, among others. Excerpts.
Why did you establish Dukia Gold?
We set up Dukia Gold to ensure that every Nigerian invests in gold, unlike in the oil and gas sector, where only a few people are allowed to own or trade in the sector. Our objective is to give Nigerians the opportunity to own an investment-grade precious metal. To achieve this, we created an open, transparent marketplace where Nigerians can buy and trade in gold. If you go to www.dukiapreciousmetal.co, it will take you to a site where you can register. It is like a one-stop market for gold.
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Basically, Dukia Gold is able to deliver gold in any gramme or kilogramme to the average Nigerian who is interested in investing. We own a mining site where Nigerians can explore raw gold, which we also refine and sell. We advocate that every Nigerian should own a gold account because the economy is so unpredictable.
About 30 years ago, there used to be a gold standard where one American dollar was equivalent to a gramme of gold, and that was because so many dollars were printed by the United States government because they needed to make sure that it was backed up by gold. But the policy was reversed. Today, gold is accepted as a means of transaction. We also have a website where investors can get the current price of gold that is globally acceptable.
In January last year, for instance, the interest rate was around 15 percent–18 percent, inflation was around 20 percent–25 percent, and the official exchange rate was N400–N500, while officially, it was around N650. Compared to this year, it is between N1200-N1,400. And the inflation rate is almost 30 percent.
How can Nigeria attract and sustain the needed investments in the solid minerals sector?
Nigeria can attract investments into the sector by creating an enabling environment for investors to come in. The government must adopt globally acceptable standards that promote investment.
There is what is called the ‘Competent Persons Report’, which is a key criteria for miners to find finance for your projects. Currently, in Nigeria, we don’t have a Competent Persons Report. If you want it, you have to pay for it, and this is done by a foreign entity. There is a need to provide it. There are so many guidelines that are relevant to the mining sector. We must make sure that our organisations or agencies comply with global standards.
The government needs to put security in place. We get minerals from local areas to where they will be processed or exported. So you need to ensure safety.
There should also be some tax incentives so as to attract external financiers or investors. I think the government needs to solve an internal problem, which is providing cheap phones that miners or those that operate in the value chain can access at cheaper rates.
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Do you think the launch of the Community Development Agreement (CDA) will address some of the challenges bedevilling the sector?
Well, I will say yes, partly because the document seeks to provide guidance for both parties. That is, before you proceed to mining. You understand that it starts from the point of exploration; the miner is investing and requires access to the site to dig and take samples. I want to see the prospects; they may be real, and they may end up being non-existent at that point. The mining entity only took a risk because it was not sure if the ground would yield the expected result.
However, gaining community trust requires significant dedication. Residents may initially be apprehensive, fearing exploitation by mining companies. The Community Development Agreement (CDA) is a crucial tool to address these concerns. It outlines who should be involved in discussions and establishes terms of operation, including benefit-sharing and environmental protection measures. By fostering open communication and ensuring communities have a stake in the project, the CDA can help build trust and positive relationships.
The CDA is a welcome development, formalising a necessary process. It goes beyond immediate community and considers those potentially impacted by mining activities, such as dust, noise, or traffic. By including these communities in discussions and agreeing on compensation measures, the CDA promotes a more comprehensive and equitable approach.
While the CDA is a positive step, ensuring clear and inclusive agreements is crucial. Disputes over land rights or inadequate consultation can lead to delays and frustration for both communities and mining companies. Finding ways to guarantee all parties have a voice throughout the process can help prevent such conflicts.
Some stakeholders are calling for a one-stop market for solid minerals in Nigeria. Do you subscribe to this?
The establishment of a one-stop market for solid minerals will meet the needs of investors, as it will reposition the sector and ensure that it contributes maximally to the growth of the economy. It is crucial in numerous ways to the growth of the economy, as it will foster collaboration among stakeholders. A one-stop market that will meet the needs of investors will facilitate the efficient use of the Decision Support System (DSS), promote knowledge sharing, best practices, and capacity building within the sector.
What is your take on the proposed N1Bn solid minerals corporation?
I would say it is a welcome development; however, we are yet to understand how it will work. Maybe there are some proven-result resources on the sites that will be presented to make them attractive for the private sector to invest in. N1 billion is just in terms of equity contribution for registration.
We know that beyond that, the money that will be required to run even one licence will cost millions of dollars. How will this work? Will the government also contribute to that? I don’t want to say much about it because I don’t have details of how it will work. But generally speaking, private sector participation helps.
How can Nigeria handle the hazards of mining activities?
Verification of conformity and a certificate of conformity are key. Anyone can give you the right to buy, but somebody must confirm if it is legally permissible. So the federal government has done its part by agreeing that it will issue either exploration or mining licences or permits to purchase, possess, or export minerals once you comply with the local and international standards expected of you.
For instance, you mentioned Oyo State; if the verification of conformity was carried out on that establishment and a certificate of conformity was issued, it would have been obvious to everyone that the person was storing dangerous goods within an estate.
I don’t see anybody in this world that would give you a certificate of conformity in a residential area. So, don’t blame the federal or state governments. Let us blame those who do not conform to the minimum standards.
So the issue of verification and issuance of certificates of conformity must be a headline issue for Nigeria. Some people take solid minerals from the mining site; they are radiated minerals. How do you transport radioactive materials on a federal highway in a container that does not protect you? So no matter how much we invest in infrastructure, if we don’t conform to standards, we are going to have an industry that will remain backward.
