Nigeria has registered a commercial transaction of raw gold sales with the London Bullion Market Association, Minister of Solid Minerals Development, Dele Alage, said on Sunday.
He said the sale increased Nigeria’s foreign reserves by $5 million and pumped N6bn into the rural economy through the successful mobilization of 70 and kilograms of refined gold to the London Bullion Market good delivery standard and locally mined gold.
Alage disclosed this at the weekend when he presented President Bola Tinubu with the latest gold bars sourced from artisanal and small-scale gold miners and refined by the Solid Minerals Development Fund.
In a statement signed by the Special Assistant on Media, Segun Tomori, the minister said the refined gold would be sold to the Central Bank of Nigeria to boost foreign reserves.
Nigeria is said to have about 600,000 tonnes of gold reserves, located in several states including Zamfara, Edo, worth about $45 billion.
However, the rise of illegal mining has led to significant diversion of the country’s commonwealth into the hands of individuals, thereby depleting resources for public welfare.
Three years ago, former President Muhammadu Buhari declared Zamfara State a 'no-fly zone’ as part of efforts to curb the problem of illegal gold mining.
At the event, Alage commended Tinubu for championing reforms in the solid minerals sector, promising that the National Gold Purchase Program would increase the country’s reserves and increase the value of the naira.
Alage, who explained the significance of the event to President Tinubu, said it marked the first commercial transaction under the National Gold Procurement Scheme, a decentralized coordination and centralized offtake scheme supported by a productive network of artisanal and small-scale miners and cooperatives.
He said, “The successful completion of the first commercial transaction proves the effectiveness of the National Gold Purchase Scheme. This shows that a viable strategy is to increase the country’s foreign reserve assets and use the Nigerian Naira to purchase a liquid asset such as gold traded in US dollars. This transaction underlines the potential of the National Gold Purchase Scheme to improve financial and monetary stability.
Tinubu, who was presented with a symbolic armband, commended the ministry for achieving a major milestone in the administration’s drive to diversify the economy.
„This is another concrete step towards the diversification process under the Renewed Confidence Agenda,” the President said.
In her presentation, the Executive Secretary of Solid Minerals Development Fund, Fatima Shinkafi, said that the London Bullion Market Good Delivery Standard is a globally recognized strict and reliable standard that enables global trading of gold and silver bullion.
„Only gold and silver bullion that meet our good delivery standards will be accepted for settlement of the Loco London Agreement – bullion trading will take place here in London,” he said.
Shingafi said through the efforts of the National Gold Purchase Program under the Ministry of Solid Minerals Development, Nigeria has joined a select group of countries that are boosting their gold reserves by buying gold in local currency to build economic confidence, promote and create currency stability. A very attractive environment for foreign investment.
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