- EMERGE aims to reduce geological uncertainty for investors
- Nigeria targets stronger mining growth beyond oil dependence
ABUJA, NIGERIA – Nigeria is betting that better geological data, rather than more mining licences, could finally unlock the vast mineral wealth long seen as central to the country’s economic diversification ambitions.
The government this week launched the Early-Stage Mineral Exploration and Research Grant Endowment (EMERGE), a new programme designed to support exploration activities, reduce investor uncertainty and accelerate capital flows into the mining sector.
Nigeria is widely believed to possess substantial deposits of gold, lithium, iron ore, lead, zinc, bitumen and other commercially valuable minerals. For decades, policymakers have argued that these resources could help reduce dependence on oil revenues while generating exports, jobs and investment.
Yet despite repeated reforms and the issuance of thousands of mineral licences, mining remains a relatively small contributor to the economy. International mining companies continue to show interest, investors frequently discuss the sector’s potential and government officials regularly highlight Nigeria’s geological promise. However, the large-scale investment needed to transform that promise into reality has remained elusive.
Officials believe part of the problem lies beneath the surface.
Through EMERGE, the government aims to support exploration activities that can identify, evaluate and quantify mineral deposits. The objective is to reduce geological uncertainty, improve investor confidence and accelerate the flow of capital into the sector.
The initiative reflects a growing recognition that Nigeria’s mining challenge may not simply be a shortage of licences or incentives, but also a shortage of reliable geological information.
Minister of Solid Minerals Development Dele Alake said at the programme’s launch that EMERGE was a strategic intervention under the government’s reform agenda and would operate through three streams: Exploration, Critical Minerals, and Research and Development.
“The Exploration Stream funds the grassroots, early-stage work that finds and proves new mineral deposits,” he said.
“The Critical Minerals Stream funds both the search for the minerals that the global energy transition demands and the processing technologies that allow us to refine them here in Nigeria. The Research and Development Stream funds the geoscience and mineral-processing research that underpins all of this,” he added.
The government did not disclose the size of the grants to be awarded. However, Alake said applications would be assessed strictly on merit and administered independently by PwC. He added that EMERGE would be financed through the Solid Minerals Development Fund, which was established to provide financing to the mining sector.
A sector constrained by uncertainty
The government aims to raise mining’s contribution to gross domestic product to 10% by 2026. Historical performance, however, highlights the scale of the challenge.
According to a 2023 PwC report, mining contributed between 4% and 5% of GDP during the 1960s and 1970s before the discovery of crude oil transformed Nigeria’s economic structure. Between 2018 and 2022, the sector’s contribution fell to just 0.17%.
PwC identified several obstacles holding back the industry, including insecurity, smuggling, weak alignment between state and federal taxation, illegal mining, limited value addition, low levels of mechanisation and inadequate funding.
Whether exploration grants can succeed where previous initiatives have struggled remains an open question.
Mining differs from many other industries because investment begins with uncertainty. Before investors can finance a mine, build processing facilities or commit billions of dollars to production, they must establish whether economically viable deposits exist. They need reliable information about the size of a resource, its quality, extraction costs and commercial viability.
Generating such information requires exploration, one of the riskiest stages of the mining value chain. Companies often spend significant sums on geological surveys, sampling programmes and drilling campaigns without any guarantee of success. Deposits may prove too small, too low-grade or too costly to develop. In many cases, exploration efforts fail to identify commercially viable resources altogether.
This creates a financing gap. Investors are often willing to support mine construction once reserves have been proven, but many are reluctant to fund the early-stage exploration required to discover those reserves.
That challenge is particularly acute in Nigeria. While the country is widely regarded as mineral-rich, many prospective deposits remain insufficiently explored according to internationally recognised reporting standards. As a result, investors often face uncertainty regarding the size, quality and commercial viability of potential projects.
PwC argued in its 2023 report that Nigeria should focus on de-risking investments through greater emphasis on geological data gathering and the development of bankable commercial discoveries. It said this could help transform the mining ecosystem and attract both domestic and foreign investment.
The consultancy also recommended improved accessibility and commercialisation of geological information through a national data repository.
A second recommendation centred on a strategic minerals development drive. PwC argued that Nigeria should align its minerals strategy with evolving global demand, particularly for minerals linked to battery manufacturing and the energy transition.
It noted that lithium, nickel, cobalt and tin had been identified in Nigeria and classified among the minerals of the future, yet many had not been formally designated as strategic minerals. The firm urged the government to review its strategic minerals list, legislate for critical minerals production and processing, and establish dedicated investment funds to support supply chains.
This helps explain why the issuance of licences alone has not generated the level of investment policymakers expected. Access to mineral acreage creates opportunity, but it does not eliminate uncertainty. Investors still need confidence in what lies beneath the ground.
EMERGE seeks to address precisely that information gap. By supporting exploration activities, the government hopes to generate data that can reduce risk, improve project bankability and encourage greater participation from private investors.
The concept is hardly unique. Many of the world’s leading mining jurisdictions invested heavily in geological mapping and exploration long before they emerged as major destinations for mining capital.
Still, the programme’s effectiveness will depend heavily on implementation. Questions surrounding transparency, governance and accountability are likely to shape investor perceptions.
How projects are selected, how funds are allocated, how exploration outcomes are monitored and whether resulting geological information becomes accessible to the wider industry will all influence the programme’s credibility.
Exploration grants alone are also unlikely to solve every challenge facing Nigeria’s mining industry. Investors continue to monitor infrastructure gaps, regulatory certainty, security concerns, access to finance and the broader ease of doing business.
Nevertheless, exploration occupies a unique place in the mining ecosystem. Without credible geological information, many other reforms have limited impact because investors cannot accurately assess opportunities.
As global demand for critical minerals rises, driven by renewable energy technologies, battery manufacturing and industrial transformation, countries with significant resource endowments are racing to position themselves within emerging supply chains.
For Nigeria, that presents an opportunity not only to increase extraction but also to expand processing capacity, strengthen manufacturing linkages and diversify exports.
Ultimately, EMERGE will not transform Nigeria’s mining sector on its own. The industry will still require regulatory consistency, infrastructure investment, institutional credibility and sustained private-sector participation. Yet the programme addresses a fundamental constraint that has long limited development.
Nigeria’s mineral wealth has never been the central question. The more important question is whether enough is known about that wealth to make it investable. The success or failure of EMERGE will depend on whether it can finally provide that answer.
