By: ROTIMI ASHER
Estimated to be the sixth largest in the world but has not yet been exploited, Nigeria holds about 42.74 billion tonnes of proven reserves of bitumen, a potential huge source of revenue for the country.
The Minister of Mines and Steel Development, Olamilekan Adegbite disclosed this recently during a pre-event press conference in Abuja, Nigeria.
He said, ‘’ local bitumen production would save the country’s foreign exchange and generate income for the government,’’ adding that, ‘with the production of bitumen locally in the country, the cost of road construction would ultimately reduce.’’
He noted, ‘’we have a total bitumen reserve size of 42.74 billion metric tonnes which has remained unexploited for years. This creates a huge opportunity for domestic bitumen production to replace the country’s reliance on imported bitumen.’’
Adegbite said, ‘’ the World Bank projects that Nigeria’s current urbanization rate of 52 per cent will increase by 4 per cent annually. As a result, 90 percent of goods, such as food and building materials are transported by road to meet the demands of the country’s rising population.’’
According to him, ‘this will increase demand for road infrastructure and put additional strain on the current road network, resulting in higher demand for asphalt for construction and maintenance.’’
He explained, ‘’ bitumen is a crucial component of asphalt that is used in road construction and once we begin production locally, we will have stable price that does not fluctuate with the exchange rate.’’
While noting that the country had a huge infrastructural deficit with regard to paved roads, Adegbite said, ‘’ Nigeria currently has 200,000 km of road networks with only 60,000km worth of road paved which presents an inherent demand for bitumen. Hence, the development of bitumen will lead to import substitution, local content development and increased value addition of the mining industry to the domestic economy, thereby creating jobs and generating revenue for the government.’’
‘’ The country is now poised to begin the production of bitumen locally as it has appointed a transaction advisor to oversee the process. To ensure that Nigeria’s bitumen resources are fully harnessed for industrial development, I constituted a nine- member Ministerial Bitumen Development Committee on January 31st 2020.’’
‘’ This committee,’’ according to him, ‘’ has carried out an inventory of internal existing infrastructure, compiled available geological information, re-established contact with previous interested companies and developed a framework for transparent allocation of bitumen resources.’’
‘’ An important part of the committee recommendations was to finalize the process of engaging a Transaction Advisor to ensure the concession process is open, transparent and in accordance with global best practices as enshrined in the Nigerian Mineral and Mining Act, 2007.’’
He said, ‘’ the Bureau of Public Procurement issued a notification of no-objection on June 16, 2021. In November 11,the ministry issued a letter of award to Price WaterHouse Coopers to act as its advisor and programme manager to manage the concession of bitumen blocks to potential investors.’’
Adegbite said, ‘’ many international and local investors had expressed interest in bidding for the bitumen blocks in the country because the mineral is of the highest grade and close to the surface which makes mining less expensive.’’
After years of failure in the past to harness its bitumen reserves, the Nigerian government is granting concessions of bitumen blocks to prospective local and international companies in an effort to put end to the importation of the mineral deposits in the country.
Used for road surfacing, roofing, adhesives and insulation, bitumen is a black viscous mixture of hydrocarbons gotten naturally from petroleum distillation. It is found in Lagos,Ogun, Ondo and Edo States.
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