Nigeria Gold Reserves: Senator Natasha’s Bill Scales Second Reading

Senate on Wednesday at plenary passed for second reading, A Bill For An Act To Make Provisions For Nigeria Gold Reserve Industry Framework, And Other Related Matters.

The bill was sponsored by Senator Natasha Akpoti-Uduaghan (PDP/Kogi Central).

In her lead debate, Senator Natasha said the Nigerian Gold Reserve Bill represents a proactive step towards harnessing and maximising the potential of Nigeria’s gold reserves by establishing a robust framework for the harnessing, exploitation, and marketing of gold.

She noted that central banks globally have been increasing reserves held in gold as a hedge against currency volatility and geopolitical risks.

“Gold reserves are critical for the economic stability of a country, acting as a reliable store of value, particularly during financial uncertainties.

“Before the fall of the Naira, that we are now experiencing the negative effects, one Naira was equivalent to one Dollar or even greater at a time. This was because the value of the Naira was measured against Gold.

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“By virtue of Section 2 of the Financial Agreement (Decimal Currency) Act (the Act that established the use of the Naira), “the parity of the Naira shall be equivalent to 1.24414 grams of fine gold”. A gram of gold is currently approximately $75.70, this was the strength of the Naira before its fall,” she said.

The merits

The Bill seeks to strengthen Nigeria’s position in the global gold market and ensure responsible and sustainable practices that benefit the country’s economy and communities.

The Bill also seeks to establish the Nigeria Gold Authority (NGA) that will be charged among other things, with the administration of Nigerian Mining Act with regards to the country’s gold resources thereby creating a robust gold reserve industry for the nation.

It also seeks to enhance the exploitation and sales of gold within Nigeria that will not only enhance the engagement and earning power of artisanal local miners but also ensure the maintenance of a strong Gold Reserve Ratio, as bulwark for strong and resilient economy that will create jobs in Nigeria through the gold industry.

The Bill further seeks to diversify Nigeria’s Reserve base by engendering the broadening of the nation’s gold reserve ratio which currently stands at less than 2% of the total foreign reserve.

By erecting a local gold exploitation, harnessing and marketing industry with the Central Bank of Nigeria as the ultimate off-taker of all gold produced in Nigeria and with same, maintains a healthy Gold Reserve base, the Bill seeks to assist in hedging the Naira against depreciation and the economy against inflation, given the intrinsic value of Gold which, comparatively, remains stable as a store of value.

The Bill presents a significant opportunity to drive economic growth and diversification by creating a conducive environment for investment in the gold sector, that can attract both domestic and foreign investors, stimulate job creation and boost revenue streams for the government.

Recognising the importance of environmental sustainability, the Bill incorporates stringent regulations to minimise the ecological footprint of gold mining and processing activities. It emphasises reclamation and rehabilitation efforts to ensure the long-term health of our natural ecosystems.

The Nigeria Gold Reserves Bill focuses on fostering positive relationships with local communities through transparent consultation processes, community benefits agreements, and the establishment of community development funds.

It also seeks to ensure that the benefits of gold mining extend beyond corporate profits to uplift the lives of Nigerians.

The clear regulatory frameworks outlined in the Bill provide certainty to industry stakeholders while ensuring accountability and transparency in operations.

The Bill received support from senators, who recognised its potential to contribute to Nigeria’s economic growth and development.

Senator Adetokunbo Abiru described the Bill as “timely and important,” while Senator Adeola Olamilekan commended Senator Akpoti-Uduaghan for her efforts to address illegal gold mining.

Senator Sanni Musa noted that the Bill would create job opportunities and help end illegal mining.

Senator Isah Jibril Echocho commended Senator Akpoti-Uduaghan for her initiative, stating that the Bill would enhance gold reserves utilisation and strengthen the Naira.

Senator Adams Oshiomhole suggested including capital punishment for illegal gold mining offenses.

The Deputy Senate President, Senator Barau Jibrin, who presided over the plenary, lauded Senator Akpoti-Uduaghan’s intelligent move to boost the economy.