Energy
World Bank appraises Nigeria’s application of $120m mining credit
ABUJA – The World Bank has declared as satisfactory the implementation of about $120 million Sustainable Management of Mineral Resources Project for the revitalization of Nigeria’s minerals and metal sector.
The Bank with all it’s meticulous vetting and assessment of its programmes and projects in developing countries unabashedly praised Nigeria’s shot at a mining renaissance three decades after the demise of the sector. But, the commendation was largely anchored on what the bank regards as the prudent and judicious use of a $120 million grant it had extended to Nigeria as an incentive to resuscitating Nigeria’s solid minerals sector.
The grant, known as the Sustainable Management of Mineral Resource Project (SMMRP), is a home-grown intervention which was conceptualized after a National mining Policy dialogue in 2004. It became effective in April 2005 and was implemented through a seven-year period with an original closing date of June 2010. But the World bank granted an extension as compensation for some implementation delays which occurred earlier in the life of the project.
The $120m credit which has a 30-year repayment term with a 0.75 percent commission was taken as part of government’s emphasis on developing the non-oil sector to diversify the economy. It also conforms to the World Bank Group 2004 Joint Interim Strategy for Nigeria which was aimed at improving economic governance, creation of conditions for rapid private sector-led poverty reducing growth and enablement of local communities to take charge of their own development.
However, according to the agreement, the Federal government is expected to put in $7 million as counterpart funding, which sadly, till date, it has not.
In a document entitled: “Implementation, Completion and Results Report”, the global bank noted that in all the 15 financial and procurement audits conducted between the inception of the project in 2005 and its conclusion in May 2012, the SMMRP was satisfactory in all except the audit conducted in March 2007, in which it was rated moderately satisfactory.
The document jointly signed by the Vice President of the World Bank, Muktar Diop, Nigerian Country Director, Marie Nelie, Sector Manager, Christopher Sheldon, Project Team Leader, Ekaterina Mikhaylova, and the Primary Author, Sabine Cornelius, defended the overall satisfactory rating of the Federal Government’s Project Management Unit (PMU) which handled the project, noting that, “Despite the multiple disruptions and considerable constraints, the Project continued to function well.”
It further revealed that in the financial management of the credit, all audits were unqualified and cases of fraud were uncovered, adding that during implementation of the procurement, two-thirds of project’s procurement performance ratings were mostly satisfactory.
The report commended the Federal Government for taking over the funding responsibility of SMMRP-supported projects such as the Mining Cadastre Office and the Nigerian Institute of Mining and Geosciences, NIMG, Jos.
The Project which was flagged off in April 2005 had two main objectives, namely to increase government’s long-term institutional and technical capacity to manage Nigeria’s mineral resources in a sustainable way, and to establish a basis for poverty reduction and rural economic renewal in selected areas of the country through the development of income generating opportunities through small-scale and artisanal mining and diversifying away from oil sources of income.
According to the report, the project achieved improved governance and transparency outcomes in the well-performing state-of-the-art cadastre system, efficient management of mining licenses, strengthened institutional and technical capacity, legal and regulatory framework as well as private sector-led development, increased mining activities and increased annual royalty collection value among others.
The bank observed that the SMMRP has strengthened the capacity of key government institutions to better manage the sector. It has also improved governance and transparency which is largely responsible for the commendable inflow of foreign investments into the sector.
On governance and transparency, the report noted that the SMMRP had funded the establishment of a “well performing and world class Mining Cadastre Office. it is remarkable that Nigeria has one of the best Cadastre systems in Africa,” it stated, adding that at the closure of the Project, over 10,056 mining licenses had been issued. “This is more than twice the projections that was envisaged at the inception of the SMMRP,” it added.
The report further noted that the project has made very significant progress towards achieving its development objectives. This includes the completion of the airborne geophysical work and geo-chemical mapping studies of the country. It added that prior to the SMMRP, “the newly restructured Ministry of Mines and Steel Development (MMSD), which was housed in dilapidated physical premises and lacked adequately skilled staff.”
Indeed, the rejuvenation of mining into a tangible economic activity in Nigeria largely lies in the hands of small scale and artisinal miners, whose total number, according to a recent survey, may well be practised by two million Nigerians. But, their activities are haphazard, uncoordinated and destructive to the environment with no reclamation and add almost zero value to the central economy, as there has been no way of regulating them. The SMMRP looks at this challenge as one of its key area of focus.
In this regard, the report commended the Project Management Unit of the Ministry of Mines and Steel development for their exemplary efforts in supervising the implementation of small grants programmes in accordance with the recommendations of the World Bank safeguards audit, which has safety measures for workers as well as proper documentations for the $10 million grant given by the Project for the formalization of Artisanal and small scale miners (ASMs).
So far, not less than 400 mining co-operatives have been formed, all aimed at securing the $10 million grants. A workshop was organised for them in Jos last June so they could be taught how to draw from the grant.
It is believed that, when this category of miners get to work, according to the new mining regulation, blue chips mining firms would easily be wooed to bring in the big capital.
The Director of the Sustainable Management of Mineral Resources Project office, Mr Linus Adie, who was at the meeting, told the gathering that “this is the largest World Bank mining project, not only in Africa, but in the whole world. It came immediately after the Extractive Industry Review of the country.”
According to him, the 0.75 percent credit tied to the grant spread over 30 years repayment period, means it would be of very little burden to repay.
Industry watchers believe that Nigeria is making steady progress towards revamping the mining sector. All that is needed is a transparent running and regulation of the sector and the development of basic infrastructure that encourage big time miners to come in.
The Nigerian Content Development and Monitoring Board (NCDMB) has confirmed that the Nigerian Oil and Gas Park Scheme in Emeyal-1, Ogbia Local Government Area of Bayelsa State, is moving closer to completion.
The NCDMB in a statement on Sunday under the signature of its General Manager, Corporate Communications, Dr Obinna Ezeobi, assured that the facility would become operational in the fourth quarter of 2026.
The board maintained that it is working toward the set timeline and plans to install a 2.5-megawatt Compressed Natural Gas (CNG) power plant at the park to support its take-off.
“Towards the target date, the NCDMB is set to install a 2.5-megawatt Compressed Natural Gas power plant at the park,” the statement said.
The installation of the power plant, the NCDMB added, is a key requirement for operational readiness, as it will guarantee a stable and sustainable electricity supply for industrial activities within the park.
The statement followed an assessment visit to the facility by senior officials of the board on Friday. Ezeobi noted that the inspection showed visible progress in critical infrastructure and support systems.
He explained that the tour revealed significant advancement in infrastructure development aimed at positioning the park as a major industrial hub for Nigeria’s oil and gas sector.
The inspection also confirmed steady progress across key infrastructure and support systems designed to establish the facility as a major industrial hub for the country’s oil and gas industry.
The NOGaPS project, according to the board, was conceived to deepen Nigerian content by creating a manufacturing base for oil and gas components, equipment and other inputs, while also generating employment opportunities.
“The Nigerian Oil and Gas Park Scheme was conceived to deepen Nigerian content by providing a conducive environment for the manufacturing of components, equipment and other inputs required by the oil and gas industry, while creating employment opportunities for over 2,000 persons when fully operational and stimulating economic growth,” the statement added.
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Officials said several key facilities within the park have already been completed and are ready for use. These include manufacturing shop floors, a water treatment plant, accommodation facilities, classrooms, an amphitheatre, and residential apartments for trainers, facilitators and visiting guests.
The board also confirmed that alongside the planned CNG power plant, key power infrastructure such as switchgear buildings, transformers and heavy-duty generators have already been completed.
“In addition to the CNG power plant, NCDMB has also completed key power infrastructure, including the switchgear building, transformers and heavy-duty generators,” it stated.
It was further disclosed that a contract has been awarded for sand-filling of ponds within the facility. After completion, six manufacturing sheds will be constructed on the reclaimed land for investors and service providers.
The board said environmental maintenance activities, including landscaping and routine facility upkeep, are ongoing to preserve infrastructure and ensure readiness. It added that work is focused on ensuring all supporting infrastructure and utilities required for seamless operations are in place ahead of the park’s planned operational date.
When operational, the Oil and Gas Park Scheme is expected to serve as a strategic platform for the growth of indigenous manufacturing and service companies, reduce dependence on imported oil and gas components, create employment opportunities for Nigerians and strengthen local participation across the oil and gas value chain.
The board reiterated its commitment to delivering the project in line with its mandate of developing in-country capacity and advancing Nigerian content in the oil and gas industry.
New crude grade variants, Utapate and Cawthorne, have boosted Nigeria’s crude oil production by 12.16 million barrels.
The crude grades, introduced in 2024 and early 2026, represent the latest additions to the country’s basket of crude oil grades aimed at expanding export streams and strengthening oil revenues.
Data contained in the Nigerian Upstream Petroleum Regulatory Commission’s (NUPRC) monthly crude and condensate production, indicated that the Utapate crude grade produced a total of 8.75 million barrels between January and May 2026, while the newly introduced Cawthorne blend contributed 3.41 million barrels during the same period, bringing the combined output from both crude grades to approximately 12.16 million barrels.
The data also showed that Utapate has yet to achieve its projected output target announced by the government, even as production remained more than 20,000 barrels per day below the 80,000 bpd target set by operators.
The figures showed that Utapate recorded an average daily production of 55,190 barrels in January. Based on the 31-day month, this translated to a total monthly output of 1.71 million barrels.
Output increased to 57,970 barrels per day in February, yielding about 1.62 million barrels, before rising marginally to 58,020 barrels daily in March, equivalent to roughly 1.80 million barrels.
In April, the field attained its highest daily production level of 59,290 barrels, producing an estimated 1.78 million barrels during the month. Production moderated slightly to 59,170 barrels per day in May but still generated approximately 1.83 million barrels due to the longer calendar month.
However, despite the upward trend, the data indicated that Utapate remained significantly below the 80,000 barrels-per-day target. The field fell short by 24,810 barrels daily in January, 22,030 barrels in February, and 21,980 barrels in March.
The production gap narrowed to 20,710 barrels per day in April before widening marginally to 20,830 barrels in May.
The development suggests that although operators have made progress in scaling up production, the ambitious target announced earlier by the Nigerian National Petroleum Company Limited has yet to be realised.
The Utapate field, which commenced production in May 2024, had been projected to achieve 80,000 barrels per day by the end of 2025.
The Utapate crude blend was introduced into the international market by the NNPC Ltd and its partner, Sterling Oil Exploration and Energy Production Company Limited, following the lifting of the maiden cargo of 950,000 barrels destined for Spain.
Produced from Oil Mining Lease 13 in Akwa Ibom State, the crude grade possesses characteristics that have attracted international interest. It has a sulphur content of 0.0655 percent and a relatively low carbon footprint resulting from flare gas elimination.
Meanwhile, another emerging crude stream, Cawthorne, contributed 3.41 million barrels to Nigeria’s production between January and May, according to the NUPRC data.
The figures showed that Cawthorne’s average daily production rose sharply from 12,340 barrels in January to 16,450 barrels in February and 23,970 barrels in March. The field sustained the momentum in April, reaching 30,970 barrels per day before easing slightly to 28,940 barrels daily in May.
The monthly production volumes translated to 382,540 barrels in January, 460,600 barrels in February, 743,070 barrels in March, 929,100 barrels in April and 897,140 barrels in May.
The NNPC Ltd had recently announced the commencement of exports from the Cawthorne blend, describing the development as part of efforts to increase Nigeria’s crude oil production and strengthen the country’s position in the global energy market.
In a statement, the Chief Corporate Communications Officer of NNPC Ltd, Andy Odeh, said the first cargo of the new grade was lifted aboard the MT Eburones vessel for shipment to the Netherlands.
“The Nigerian National Petroleum Company Limited has commenced export of its new crude grade, Cawthorne, marking a significant milestone in the company’s drive to increase Nigeria’s crude oil production and expand its portfolio of globally competitive export streams,” Odeh said.
He added, “Cawthorne blend crude, the latest addition to Nigeria’s basket of crude grades, has an API gravity of 36.4, placing it firmly within the light, sweet category, comparable to Bonny Light, and highly valued in the global market for its superior petrol and diesel yields.”
According to him, the maiden cargo, estimated at 950,000 barrels, was exported through the Cawthorne Floating Storage and Offloading vessel located offshore Bonny, Rivers State.
“The cargo was exported via the Cawthorne Floating Storage and Offloading vessel, which is strategically located offshore Bonny. The facility enhances crude evacuation from OML 18 and strengthens Nigeria’s export reliability, operational efficiency and overall energy security,” Odeh stated.
The emergence of both Utapate and Cawthorne underscores Nigeria’s determination to diversify its crude export portfolio and maximise oil earnings. However, the latest NUPRC figures also highlight the operational challenges facing producers as they strive to convert ambitious output targets into actual barrels.
Combined, Utapate and Cawthorne contributed an estimated 12.16 million barrels of crude oil between January and May, providing additional support to Nigeria’s broader efforts to sustain production growth and improve foreign exchange earnings from the oil sector.
On Thursday, the NUPRC reported that Nigeria’s crude oil production rose above its Organisation of the Petroleum Exporting Countries quota in May 2026, with the country recording its highest crude output in 15 months amid improved operational stability and the absence of major disruptions across key oil facilities.
Data released showed that Nigeria produced an average of 1,530,354 barrels of crude oil per day in May, representing 102 per cent of the country’s 1.5 million barrels-per-day quota approved by OPEC.
When condensate production of 170,446 barrels per day was added, Nigeria’s total oil output climbed to 1,700,800 barrels per day, further strengthening the country’s position as Africa’s largest oil producer and boosting revenue.
OPEC oil output in May hit its lowest in more than two decades, a Reuters survey found, as a U.S. naval blockade cut Iran’s exports and Iran’s effective closure of the Strait of Hormuz slashed exports by other Gulf producers.
Output by the 11-member Organization of the Petroleum Exporting Countries fell by 1.06 million barrels per day month-on-month to 16.13 million bpd, the survey found.
That was the lowest monthly figure since at least 2000, according to Reuters surveys, and well below the levels seen during the COVID-19 pandemic in 2020 when demand collapsed.
The figures exclude the United Arab Emirates which quit OPEC as of May 1.
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Saudi Arabia had a further decline, although Iraq was able to increase supply due to increased domestic use, sources in the survey said.
Venezuela and Nigeria also pumped more.
Eight members of the OPEC+ producer group, which includes OPEC plus allies including Russia, had agreed to raise production in May, but the Iran war and U.S. blockade made that impossible.
The Reuters survey is based on flow data from financial group LSEG, information from other companies that track flows, such as Kpler, and information provided by sources at oil companies, OPEC and consultants.
Credit – Times of India
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