The Federal Government has signed a landmark $1.3 billion Memorandum of Understanding with the Africa Finance Corporation (AFC) to develop a major alumina refinery and strengthen Nigeria’s solid minerals sector.
The agreement, signed through the Solid Minerals Development Fund (SMDF), covers three key initiatives: construction of a $1.3 billion alumina refinery, a nationwide geoscience mapping programme, and the establishment of a joint strategic investment vehicle to accelerate mineral exploration and development.
Speaking at the signing ceremony, the Minister of Solid Minerals Development, Dr. Dele Alake, described the deal as a transformative step that will reposition mining as a major contributor to Nigeria’s Gross Domestic Product (GDP).
He said the refinery, designed to operate for about 20 years at 95 per cent capacity utilisation, is projected to produce about 19 million tonnes of alumina over its lifespan.
According to the Minister the project is expected to generate approximately 1 million tonnes of bauxite ore annually using a modern Bayer-process flowsheet, supported by an on-site gas-fired cogeneration plant for steam and power generation.
The Minister noted that the investment could contribute about $1.2 billion annually to GDP, inject over $25 billion into the national economy across its lifecycle, and generate about $8 billion in foreign exchange earnings.
He added that the initiative aligns with the Federal Government’s policy of promoting value addition, attracting foreign direct investment, and strengthening Nigeria’s competitiveness in the global minerals market.
The Minister also directed relevant agencies to ensure swift processing of all necessary permits and regulatory approvals to guarantee timely execution of the projects.
On his part, the Permanent Secretary, Farouk Yabo, said the project reflects ongoing reforms aimed at modernising the regulatory framework and creating a secure investment environment for private sector participation.
Also speaking, the Executive Secretary of the Solid Minerals Development Fund, SMDF, Fatima Shinkafi, described the agreement as the agency’s largest funding project since its establishment, saying it marks a significant milestone in advancing the Ministry’s value-addition agenda.
Under the agreement, AFC and SMDF will set up a joint investment vehicle to fast-track exploration, development, and production across selected mineral assets nationwide.
Feasibility studies conducted by AFC and SMDF confirmed that the project’s commercial viability, will position Nigeria as a leading global destination for mineral investment.
