By Kikelomo Okere
The Nigeria Extractive Industries Transparency Initiative, NEITI, has raised fresh concerns over rising illicit financial flows in Nigeria’s solid minerals sector, warning that illegal mining, weak regulation, and opaque ownership structures are crippling the industry’s economic potential.
In a new policy brief released in Abuja, NEITI said the mining sector continues to suffer massive revenue leakages driven by tax evasion, smuggling, corruption, money laundering, and the growing influence of organised criminal networks.
The report noted that despite Nigeria’s vast deposits of gold, lithium, limestone, and gemstones, the sector generated only 401 billion naira in revenue and contributed just 0.72 percent to the nation’s Gross Domestic Product in 2023.
NEITI identified weak regulatory capacity, poor institutional coordination, foreign dominance in mineral purchases, and the expansion of informal artisanal mining as major factors fuelling illicit financial flows across the sector.
The agency warned that regulatory oversight remains fragmented among key institutions including the Ministry of Solid Minerals Development, Mining Cadastre Office, Nigeria Customs Service, NEITI, and the Nigeria Financial Intelligence Unit, creating loopholes that illegal operators continue to exploit.
According to the report, the absence of an integrated digital monitoring system has left critical mining data scattered across multiple agencies, weakening transparency, traceability, and enforcement efforts nationwide.
NEITI also raised alarm over hidden ownership structures in the mining industry, revealing that several mining licences are controlled through shell companies and complex corporate arrangements designed to conceal the real beneficiaries behind extractive operations.
The report further disclosed that more than 70 percent of mining activities in Nigeria are carried out by artisanal and small-scale miners operating largely outside formal regulations, while illegal mining accounts for nearly 80 percent of activities in parts of Zamfara, Katsina, and Kaduna States.
NEITI warned that unless artisanal mining is urgently formalised through simplified licensing, stronger monitoring systems, financing support, and mineral traceability mechanisms, the sector will remain highly vulnerable to illicit financial flows, criminal infiltration, and continued economic losses.
