A report by the Natural Resource Governance Institute says Nigeria should focus on reducing investor risk in the mining sector.

This, it said, was to enable it to optimally support its economic diversification and energy transition.

The report was authored by NGRI’s country manager in Nigeria, Tengi George-Ikoli; the programme officer, Ahmad Abdulsamad; and Africa Senior Economic Analyst, Thomas Scurfield.

The report, titled ‘Economic Diversification, Energy Transition and Minerals: Opportunities for Nigeria‘, was unveiled in Abuja at the National Dialogue on Nigeria’s Energy Transition.

The report noted that even though Nigeria’s mineral sector offered a significant opportunity to support economic diversification and energy transition, it should not be treated as a quick substitute for oil and gas revenues.

“An immediate priority should be to reduce investor risk and strengthen state capability. This requires accessible, credible geological data integrated with the Nigerian Mining Cadastre and regulatory certainty, including clearer federal-state roles.

“Focused national mining companies that de-risk rather than replace private investment and action to address insecurity and improve artisanal and small-scale mining governance,” it said.

According to the report, aligning mining with infrastructure, energy and industrial planning should also be an early priority.

It stated that the move could help unlock scale, strengthen competitiveness and maximise broader economic benefits.

The report urged Nigeria to adopt a balanced, evidence-based approach to developing its mineral resources to support economic diversification and the country’s energy transition.

NRGI said mining had the potential to significantly boost industrialisation, job creation and the energy transition drive but warned that weak governance, policy uncertainty and poor environmental management could undermine the sector’s potential.

NRGI said that regulatory certainty, transparent policy-making and clearer coordination between the Federal and state governments were essential to attracting long-term investment in the mining sector.

According to the report, improved intra-governmental coordination will also be critical. This includes federal-state roles, land use, mineral rights, subnational charges and enforcement, and the management of overlaps between artisanal mining activity and large-scale mineral rights.

The report urged the federal government to improve the availability of geological data by digitising and integrating datasets with the mining cadastre to attract credible investors.

It also recommended aligning the ongoing review of the 2016 Mining Roadmap with the Medium-Term National Development Plan (2026–2030), as well as energy, industrial, infrastructure and climate resilience strategies.

NRGI further urged the government to prioritise the effective use of mining revenues for infrastructure development instead of creating new savings or stabilisation funds at the current stage of the sector’s development.

On value addition, it cautioned against blanket processing requirements and urged the government to focus on a limited number of mineral value chains where Nigeria has a realistic competitive advantage.

The report further stressed the need for stronger environmental governance through mandatory public disclosure of environmental impact assessments, greater community participation and improved mine rehabilitation and financial assurance frameworks.

It also called for accessible grievance mechanisms for mining host communities, aligned with international standards to improve transparency, protect human rights and strengthen investor confidence.

It said that while Nigeria’s mineral resources present significant opportunities, the country should refrain from over-reliance on mining and instead use the sector to support broader economic diversification and long-term development.

“A balanced approach using mining to support diversification rather than replace it will be essential to achieving sustainable and resilient economic development,” NRGI said.

(NAN)