No FX for barite as FG to ban import
The Federal Government will soon place a ban on further importation of barite, a move that would save $300 million every year in foreign exchange (FX).
This is as 12 barite processors have been found worthy to produce world-class barite that meets American Petroleum Institute’s (API) standards.
This was disclosed in Port Harcourt, Rivers State, Thursday, by Olamilekan Adegbite, minister of mines and steel development; Simbi Wabote, executive secretary, Nigerian Content Development and Monitoring Board (NCDMB), and Godwin Emefiele, governor, Central Bank of Nigeria (CBN), who was represented by Anthony Ifechukwu, his special assistant, at the launch of the world-class barite product.
Barite is indicated as a high gravity mineral used as sludge in the oil and gas industry to stop explosion of gas during drilling. It is mostly used by the oil and gas industry in Nigeria and this made the Ministry of Steel Development to select Port Harcourt for the launch of the product to bring the awareness closer to the users.
The major pronouncement on the proposed ban came from the executive secretary of the NCDMB who said a study was commissioned by the Board on Nigeria’s readiness to produce it locally and stop importation.
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Wabote stated that the Board commissioned a study which eventually picked out 12 processors that can give Nigeria self-sufficiency in the product and help stop any further importation.
He said the 12 companies have thus been approved to carry on with the business at API standards. He said the FG would slam the ban in 2022, but he did not mention the specific date.
The SA to the CBN boss (Ifechukwu), while offering the support of the apex bank to the barite drive, said the CBN would no longer allocate foreign exchange as soon as the ban is placed.
Instead, he said the ministers in charge of the mineral would meet with the CBN governor next week to agree on modalities for a finance package to boost local processing to meet international standards.
The concern of the CBN, he stated, is to promote whatever would help Nigeria to conserve forex use and rather earn foreign exchange as well as create jobs.
Speaking, the Minister of Mines and Steel Development (Adegbite), expressed happiness that the CBN was stepping into the mining sector with special funding, and called the launch a watershed moment in the journey to self-sufficiency in barite production.
Saying the Ministry was pursuing a presidential directive as far back as 2016, Adegbite said collaboration has brought the drive to the point of success of using Nigeria’s minerals to capture international market share and attract, saying the sector has already attracted $150m loans in 2017.
He said the drive also worked to reduce importation and create jobs in areas such as gypsum, kaolin, etc. He mentioned the Benue trough as the area rich in Barite while experts said the nation has mapped out 146 barite spots that can supply for the next 100 years.
He said Nigerian barite hub is being created for easy coordination with what he called Open Market System.
The director-general of the Nigerian Geological Survey Agency (NGSA), Garba, described Barite as an industrial mineral that has both upstream and downstream sectors, saying more studies were still ongoing.
He said, “Soon, importation of Barite into Nigeria will stop because the processes that lead to such a policy are in progress.”